This Tata Group Stock To Give Potential 20% Return In 1 Year: ICICI Direct

ICICI Direct has given a buy call to Tata Motors Ltd for a potential gain of 20% in the time period of one year when the stock's price can reach the defined target of Rs 500 apiece from the current market price of Rs 416.80 apiece.

Tata Motors Ltd. is one among India's largest automobile manufacturers, with a footprint in commercial cars, sports utility vehicles, trucks, buses and defence vehicles. The company operates in two major segments-Automotive Operations and Other Operations.

1. Tata Motors Stock Outlook

The current market price of the stock is Rs 416.80 with a 52-week high of Rs 536.70 apiece and a 52-week low of Rs 268.45 apiece. The stock has fallen 15% in 6 months and given a return of 31.05% in 1 year. According to ICICI Direct, if you buy the stock today at the CMP of Rs 416.80 apiece it can likely reach the specified target of Rs 500.

2. Tata Motors Key Strengths

It has registered growth in net profit with rising profit margins and growth in quarterly net profit with increasing profit margin YoY. It has given increasing profit every quarter for the past 4 quarters. It is a stock with low PE and the stock has emerged as the street favourite as it has received high analyst rating with at least 20% upside. The stock has received buy rating for long terms according to analyst recommendation.

3. Tata Motors Weakness

The MFs have reduced their shareholding last quarter. There is report of inefficient use of shareholder funds with the ROE dipping in the last 2 years, according to ICICI Direct report. It falls in the category of companies with high debt.

Tata Motors Q4 Results

Tata Motors reported contraction of net loss to Rs 1032 crore for the quarter ending March 31, 2022. It had announced a net loss of Rs 7605 crore one year ago. The company's total revenue from operations fell approximately by 11% to Rs 78,439 crore against Rs 88627 crore in the previous year. Tata Motors Ltd's EBIDTA (earnings before interest, taxes, depreciation, and amortization) margin for the quarter came in at 11.2%, down 320 basis points. EBIT margin registered at 3.2 per cent dipped 410 basis points.

Tata Motors About

Tata Motors About: It is a $34 billion organization and emerged as a leading global automobile manufacturing company. Tata Motors Ltd's diverse portfolio includes an extensive range of cars, sports utility vehicles, trucks, buses and defence vehicles. Tata Motors is one of India's largest OEMs (Original Equipment Manufacturer) offering an extensive range of integrated, smart and e-mobility solutions.

The market capitalisation is Rs 137,585 crore. 

Disclaimer

The stock has been picked from the brokerage report of ICICI Direct. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.