Tata Motors Share Price Declines 1.1%; Immediate Support at Rs 698
Tata Motors share price declined 1.1 percent on Monday while broader market remained rangebound and closed almost flat. Tata Motors is facing immediate resistance at Rs 725 and a breakout above this level on closing would mean higher levels for the automobile major. The stock has recently rebounded from 52-week lows and we can expect support from lower levels.
Tata Motors, a marquee name in India’s auto sector, has navigated a turbulent 2025—marked by global trade headwinds, domestic competition, and strategic pivots. Its share price, which plunged nearly 40% from 2024 highs, now shows signs of consolidation and potential rebound. The company’s demerger approval, improved ROE, aggressive electric vehicle (EV) investments, and a cleaned-up balance sheet are fueling optimism. However, the recent export blockade to the U.S. by its subsidiary Jaguar Land Rover (JLR) and intensified EV competition have kept investor sentiment cautious. Analyst forecasts suggest varied expectations, with price targets ranging from Rs 660 to Rs 1,300, emphasizing the high-stakes nature of Tata’s ongoing transformation.
Stock Snapshot and Performance in 2025
Tata Motors is currently trading at Rs 711.50, having rebounded from its recent 52-week low of Rs 535.75 (April 2025), but still far from its peak of Rs 1,179.00 (July 2024).
The stock has lost 22% over the past year, primarily due to macroeconomic disruptions and internal margin pressures. However, a recent uptick of over 11% in the past month—and 15.93% over the last quarter—suggests a tactical recovery may be underway.
Export Setback and EV Battlefront
In April 2025, JLR suspended U.S. exports after the Biden administration imposed a 25% import tariff on UK-built vehicles. The move wiped out a tenth of Tata Motors’ market value in a single day, the steepest fall in over three years.
On the domestic front, Tata’s EV market share slipped from 73% in 2023 to 62% in 2024, as JSW MG and other rivals chipped away. To counteract this, the company has committed $1.5 billion to a battery gigafactory, aiming to bolster its EV supply chain and reinforce ambitions to make electric vehicles 30% of its portfolio by 2030.
Corporate Reorganization and Dividend
Tata Motors’ demerger plan received shareholder approval, aligning with its objective of unlocking business vertical value. The firm is now debt-free on a consolidated basis, a critical milestone that reduces borrowing costs and improves balance sheet flexibility.
On May 13, 2025, Tata Motors announced a Rs 6.0 per share dividend, with a record date of June 4—an affirmation of its improving cash flows.
Technical Signals: Bullish Base with Caveats
From a chartist's perspective, Tata Motors appears to be rebounding from a 54% correction using bullish patterns like a “falling channel” and “double bottom.”
Its price has breached the 100-day simple moving average, while the RSI has climbed above 50, signaling upward momentum. That said, short-term caution is warranted. A 5-day EMA crossover and red Heikin-Ashi candles indicate the possibility of near-term pullbacks.
Financial Health and FY25 Results
Tata Motors delivered record financials in FY25:
| Metric | FY25 Value |
|---|---|
| Revenue | Rs 1,19,503 crore (up 0.39% YoY) |
| Profit Before Tax (PBT) | Rs 11,504 crore (up 21.68%) |
| EBITDA Margin | 14% (down 60 bps YoY) |
| Return on Equity (ROE) | 23.96% (vs. 5Y avg of 10.62%) |
EBITDA slipped 4.1% YoY, pointing to cost pressures, but the PBT surge underscores efficient capital deployment and debt trimming. The PE ratio stands at 11.68 and PB at 2.17, indicating moderate valuations.
What the Analysts Say
Research coverage in 2025 reveals a broad spectrum of sentiment. Here's a comparative look:
| Analyst/House | Date | Rating | Target Price (Rs) | Comment |
|---|---|---|---|---|
| Morgan Stanley | May 3 | Equal-Weight | 853 | Moderate upside of ~38% |
| CLSA | Feb 19 | High Conviction Outperform | 930 | JLR value, CV recovery |
| ICICI Securities | May | Buy | 831 | Recovery optimism |
| Jefferies | Feb 1 | Underperform | 660 | Cut post price crash |
| Emkay Global | May | Hold | 800 | Balanced sector view |
Consensus target for 2025 hovers near Rs 848, with some bullish estimates reaching Rs 1,100–1,300.
Strategic Levers and Headwinds
Growth Drivers:
EV Expansion: With $1.5B in battery manufacturing and a target of 30% EV sales by 2030, Tata is reinforcing its leadership in India’s green transition.
Demerger Plan: This structural change is expected to enhance focus, valuation transparency, and investor appeal.
Strong Domestic Demand: Government-backed incentives and new launches are buttressing local demand despite global frictions.
JLR Vulnerability: Heavy exposure to U.S. markets and the fallout from tariff barriers pose persistent threats.
Margin Pressure: Rising input costs and discounts to maintain market share are compressing margins.
Execution Risk in EVs: JLR's reluctance to pursue EV manufacturing in India points to challenges in scaling quality production.
Investor Takeaways: Opportunity in Caution
Tata Motors offers a compelling but volatile investment thesis in 2025. Its debt-free status, ROE improvement, and structural realignments are bullish underpinnings, while global disruptions and intensifying competition temper sentiment.
Short-Term Outlook: Rangebound with positive bias. Keep an eye on tariff resolutions and margin recovery.
Mid-Term Potential: Targets of Rs 800–Rs 1,100 look feasible as execution of the EV strategy and demerger gains traction.
Risk Management: Traders should maintain tight stop-loss levels given volatility, while long-term investors may consider staggered entry.
