The company said that its businesses are self-sustaining and the investments are well funded while aiming for EV EBITDA breakeven in FY26.
The management also seemed confident while stating its intentions to expand the company’s product portfolio to address 80% market share and also aim for 10% EBITDA for consolidated PV and EV operations by FY30.
The demerger of CV and PV businesses into separate entities is a logical progression, as per the management, given that both CV and PV businesses have grown sizably and limited synergies exist between the two.
Here is what analysts have to say:
CLSA
CLSA said that the management is confident in winning in the domestic segment and a sustainable share gain in PV, coupled with continued leadership in EV will pave the path for growth. They also foresee CV demand to grow at 4-5 CAGR for a few years.
They have an ‘outperform’ rating on the stock with a target price of Rs 1,181.
JM Financial
In respect of CV business, the industry is expected to
grow by a single digit during FY25 while Tata Motors is targeting a strong double-digit EBITDA margin for its CV business and expects PV-EV business to be EBITDA breakeven in the medium term. Net-cash position in domestic business drives comfort.
JM Financial rates Tata Motors as a ‘buy’ with a target price of Rs 1,200.
Motilal Oswal
The domestic brokerage firm expects JLR margins to remain stable over FY 24-26 given the rising cost pressure as it invests in demand generation, normalizing mix, and the EV ramp-up, which is likely to be margin-dilutive. Even in India business, both CV and PV businesses are seeing a moderation in demand.
Motilal has a ‘neutral’ rating on the stock with a target price of Rs 955.
ICICI Securities
New nameplates like Curvv, Sierra, Avinya etc. and the corresponding EV portfolio of 10 models would help TTMT address a wider PV market base ahead. Tata Motors is aiming to reach 10% EBITDAM in PVs and become EBITDA neutral in EVs by FY26.
With this, ICICI Securities has a ‘reduce’ view on the stock with a target price of Rs 915.
Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times.