Tata Motors share price declined 2.5 percent in today's session as overall market sentiment was bearish and NSE Nifty closed 117 points lower. Tata Motors' potential partnership with Tesla Motors failed to cheer the investors. However, more details on the partnership would be needed for investors and market analysts to rerate Tata Motors stock. The stock recently recovered from yearly lows at Rs 667 but today's negative close has once again exposed the stock to another yearly low. Tata Motors could also take support from lower levels as the stock has declined 37 percent during the last six months.

Several media reports suggested that Tesla has reached out to management at Tata Motors to discuss possible collaboration for establishing an electric vehicle (EV) manufacturing facility in India. Tesla Motors has been trying to enter the Indian market but Elon Musk has delayed his plans several times as Tesla finds higher taxes from Indian government as a major deterrent for brands that don't go for production in India.

Analyst Insights

Recent analyst reports present a mixed outlook for Tata Motors. Nomura, on January 31, 2025, adjusted the company's price target to ₹861 from ₹990, maintaining a 'Buy' rating. Similarly, Jefferies, on January 30, 2025, revised the target to ₹660 from ₹930, also retaining a 'Buy' stance. These adjustments reflect concerns over the company's performance, particularly in its Jaguar Land Rover (JLR) segment, which has faced demand challenges in key markets like China and Europe.

Technical Analysis

Candlestick Patterns

A review of Tata Motors' daily candlestick chart reveals a 'Lower High and Lower Lows' pattern, indicating a bearish trend. The stock has been forming successive lower highs and lower lows since January 8, 2025, suggesting sustained downward momentum.

Fibonacci Retracement Levels

Applying Fibonacci retracement from the 52-week high of ₹1,179.00 to the recent low of ₹667.05, key levels are identified as follows:

23.6% Retracement: ₹784.87
38.2% Retracement: ₹881.59
50% Retracement: ₹923.03
61.8% Retracement: ₹964.47
76.4% Retracement: ₹1,061.19
The stock is currently trading below the 23.6% retracement level, indicating potential resistance ahead. A sustained move above ₹784.87 could signal a reversal, while failure to do so may lead to further declines.

Support and Resistance Levels

Immediate Support: ₹662.55
Immediate Resistance: ₹690.00
Breaching the support at ₹662.55 may lead to further downside, whereas surpassing the resistance at ₹690.00 could pave the way for upward movement toward the ₹784.87 mark.

Competitive Landscape

In the automotive sector, Tata Motors faces competition from:

Maruti Suzuki India Limited: The country's largest car manufacturer, known for its extensive portfolio and market reach.
Mahindra & Mahindra Limited: A key player in utility vehicles and tractors, with a growing presence in electric vehicles.
Both competitors have demonstrated robust performance, leveraging their market positions and product offerings to capture significant market share.