Aniket PujariTata Motors share price rose as much as 1.94 per cent on Tuesday after the company announced 2 per cent price hike in its commercial vehicles, effective from April 1. Tata Motors shares were trading at ₹674.75 apiece on March 18.
The price adjustment is intended to counteract increasing input expenses in the automotive sector and will differ among various models and versions.
“Tata Motors, India’s largest commercial vehicle manufacturer, today announced a price increase of up to 2% across its commercial vehicle range, effective April 1, 2025. The price increase is to offset the rise in input costs and will vary as per individual models and variants,” the company said in an exchange filing.
The company reiterated its dedication to providing value to customers while navigating increasing financial challenges. This announcement comes after Maruti Suzuki declared a price increase of up to 4 per cent starting April 2025, attributing the hike to escalating input costs, operational expenses, and inflationary pressures.
In recent years, the automotive industry has faced significant challenges, including fluctuating global supply chains and rising commodity prices. These issues have prompted manufacturers to adjust their pricing strategies accordingly.
HSBC upgrades Tata Motors to ‘buy’
HSBC has upgraded Tata Motors‘ rating to ‘Buy’ and adjusted the target price to ₹840 from ₹930 per share. The brokerage anticipates several factors that could enhance margins and potentially lead to a re-rating of the stock.
HSBC’s positive outlook on Tata Motors is significantly influenced by its luxury vehicle subsidiary, Jaguar Land Rover (JLR). The bank’s analysis suggests that reducing discounts and warranty expenses at JLR is expected to enhance profitability by strengthening the company’s pricing power and operational efficiency. Furthermore, JLR meeting its Q4 targets could serve as a catalyst for re-evaluation, potentially restoring investor confidence in the stock.
In addition to JLR’s prospects, Tata Motors’ domestic operations are exhibiting signs of recovery. HSBC highlights an increase in Small Commercial Vehicle (SCV) sales, reflecting a resurgence in demand within the logistics and transportation sectors. Moreover, the passenger vehicle (PV) segment is anticipated to bolster its market presence with forthcoming new model introductions, which could help maintain the company’s growth trajectory in India’s highly competitive automotive market.
With several growth drivers at play, such as improving margins at Jaguar Land Rover (JLR), expansion in the domestic market, and upcoming product launches, Tata Motors appears well-positioned for strong performance in the upcoming quarters. HSBC’s updated assessment indicates that the recent stock correction offers an attractive opportunity for investors to buy.
Tata Motors’ stock faced sustained pressure as investor sentiment was shaken by Tesla’s entry into the Indian market. Over the past month, the stock has declined by nearly 4 per cent. During a six-month period starting September 17, 2024, the shares have experienced a significant drop of 32.3 per cent.
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
