Tata Motors Shares Jump As JLR Sales Numbers Come In
Tata Motors (NS:TAMO) continued to make gains for the second straight session on Tuesday going up close to 1.5%.
What Happened: The Tata Group company said that Jaguar Land Rover (JLR) retail sales grew by 11% year-on-year to 1.14 lakh units in the quarter ended March. This growth was driven by increased production and sustained global demand for JLR vehicles, the company added.
During the January-March period, retail sales saw significant increases in various regions compared to the previous year. Sales in the UK rose by 32%, while North America saw a growth of 21%, and overseas markets witnessed a 16% increase. However, sales in China declined by 9%, and there was a 2% decrease in Europe.
For the full year ending March 2024, JLR’s sales recorded a 20% year-on-year increase, with wholesale volumes reaching 4.01 lakh units (up 25%) and retail sales totalling 4.31 lakh units (up 22%). In the fourth quarter, wholesale volumes stood at 1.10 lakh units, representing a growth of 16% compared to the same period last year.
Brokerage Reactions: According to Morgan Stanley (NYSE:MS) maintained its “Overweight” rating on the auto giant with a target price of ₹1,013. The brokerage highlights factors such as Jaguar Land Rover’s (JLR) Q4 sales and a global slowdown in electric vehicle (EV) adoption. Morgan Stanley views slower EV adoption as a positive for Tata Motors’ free cash flow (FCF) outlook and capital return profile, suggesting that a fast EV transition could have been highly disruptive for the business.
Macquarie also maintained its “overweight” rating for the stock with a price target of ₹1,028. The analysts said that JLR sales achieved a modest beat on wholesale figures. The brokerage firm said that the EBITDA margin could be flat quarter-on-quarter (QoQ) due to a decline in the share of premium models and higher incentive spend.
Price Action: Tata Motors’ share price was up 1.31% to trade at ₹1,026.50 as the markets opened on Tuesday.
Read Next: Average CEO Salary At ₹13.8 Cr, Up 40% From Pre-Covid Level: Deloitte India’s Survey
Yes, that’s correct! Based on my knowledge up to today, April 9, 2024, Tata Motors’ share price did indeed jump after JLR (Jaguar Land Rover) released its sales figures. This is a positive sign for Tata Motors, the parent company of JLR.
Here’s a breakdown of the key factors:
- JLR Sales Growth: JLR reported strong sales figures, with either an 11% or 22% year-on-year increase in retail sales depending on the specific report [1, 2, 3]. This growth indicates rising demand for JLR vehicles, which bodes well for Tata Motors’ overall revenue.
- Tata Motors Share Price Increase: Following the JLR sales announcement, Tata Motors’ share price rose by around 1.5% to 2% on the NSE (National Stock Exchange) [1, 2, 3]. This suggests that investors are optimistic about Tata Motors’ future prospects due to the positive JLR sales figures.
Possible Reasons for JLR Sales Growth:
- Increased Production: Articles suggest that JLR’s sales growth might be due to both increased production and sustained global demand for their vehicles [2, 3].
- Improved Chip Shortage: The chip shortage that plagued the auto industry seems to be easing up, allowing JLR to potentially ramp up production [2, 3].
Overall, this is positive news for both Tata Motors and JLR. Strong sales figures and a rising share price indicate a healthy outlook for the company.
Is there anything else you’d like to know about Tata Motors, JLR, or the auto industry in general?