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Tata Motors Shares Spike 13% As UK Strikes New Brexit Deal

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Tata Motors Shares Spike 13% As UK Strikes New Brexit Deal
Tata Motors: Quotes, News
BSE 295.65BSE Quote6.95 (-2.35%)
NSE 295.55NSE Quote7 (-2.37%)

Shares of Tata Motors jumped as much as 13.27 percent to close at Rs 142.55 on Thursday after UK Prime Minister Boris Johnson said "we have a great new Brexit deal" on Twitter. He also said that the British parliament "should get Brexit done on Saturday" in the tweet.

Ahead of the crucial European Union summit on Thursday, negotiators from the UK and the EU reached a draft Brexit deal. Sterling Pound rose after news that the UK has made concessions over the Irish border, an issue that has been one of the biggest obstacles to a deal up to that point.

 

The Indian automobile company owns Jaguar Land Rover, which makes for over 75 percent of Tata Motors' consolidated operating profit. In the initial period, Tata Motors made profits after the acquisition from booming sales in Russia and China. However, uncertainty over Brexit, an economic slowdown in China and an overall slump in car sales in India as well as overseas brought losses.

JLR being the biggest loss maker, has its capital expenditures outpacing operating cash flow over the past two years. According to an Economic Times report, JLR has scheduled to close its UK factories for a week in November to protect itself against supply disruption from a possible no-deal Brexit.

Read more about: tata motors brexit
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