Reduce Tata Motors, target price Rs 733: HDFC Securities

HDFC Securities has a Reduce call on Tata Motors with a target price of Rs 733. The current market price of Tata Motors is Rs 724. Tata Motors, incorporated in 1945, is a Large Cap company with a market cap of Rs 261420.64 crore, operating in the Auto sector.

Tata Motors’ key products/revenue segments include Motor Vehicles, Spare Parts & Others, Miscellaneous Goods, Sale of services and Other Operating Revenue for the year ending 31-Mar-2024.

Financials
For the quarter ended 31-03-2025, the company has reported a Consolidated Total Income of Rs 121012.00 Crore, up 4.89 % from last quarter Total Income of Rs 115365.00 crore and down -.36 % from last year same quarter Total Income of Rs 121446.15 crore. The company has reported net profit after tax of Rs 8,442 crore in the latest quarter. The company’s top management includes Mr.N Chandrasekaran, Mrs.Usha Sangwan, Mr.Om Prakash Bhatt, Mr.Bharat Puri, Mr.N Chandrasekaran, Mr.Girish Wagh, Ms.Hanne Sorensen, Ms.Vedika Bhandarkar, Mr.Kosaraju V Chowdary, Mr.Al-Noor Ramji, Mrs.Usha Sangwan, Mr.Om Prakash Bhatt, Mr.Al-Noor Ramji, Mr.Kosaraju V Chowdary, Ms.Vedika Bhandarkar, Mr.Girish Wagh, Ms.Hanne Sorensen, Ms.Vedika Bhandarkar, Mr.Kosaraju V Chowdary, Mr.Al-Noor Ramji, Mrs.Usha Sangwan, Mr.Om Prakash Bhatt, Mr.Bharat Puri, Mr.N Chandrasekaran, Mr.Girish Wagh, Ms.Hanne Sorensen, Mr.Bharat Puri. Company has BSR & Co. LLP as its auditors. As on 31-03-2025, the company has a total of 368 crore shares outstanding.

Investment Rationale
Tata Motors held its investor day on 9 June 2025 to share its future plans for the India CV and PV businesses. HDFC Securities expects the CV segment to witness growth in FY26, though margins may be impacted in the near term as a result of the safeguard duty on steel. The brokerage expects the PV segment volumes to grow 2.5% in FY26, broadly in line with the industry. The slower EV sales and an ageing portfolio will be partially offset by continuing higher growth in the CNG segment (25% of its PV sales) and new refreshes/launches planned in FY26. They remain cautious in the near term due to the tariff overhang, subdued global macro, an ageing PV portfolio, slowing EV growth amidst higher competition and moderate growth for CVs. HDFC Securities values the company on a SOTP basis and a target price of Rs 733; the brokerage maintains a REDUCE rating. Promoter/FII Holdings
Promoters held 42.58 per cent stake in the company as of 31-Mar-2025, while FIIs owned 17.84 per cent, DIIs 16.84 per cent.