Tata Motors demerger: What do brokerages make of it? Is it the right time to invest in the stock?
Tata Motors demerger news, Tata Motors demerger date: Tata Motors' board approved the proposal for the demerger of the company into two separate listed companies.
Tata Motors demerger news, Tata Motors demerger date: Tata Motors' board approved the proposal for the demerger of the company into two separate listed companies: A) the commercial vehicle business and its related investments in one entity; and B) the passenger vehicle businesses, including PV, EV, and JLR, and their related investments in another entity on Monday. After the company decided to demerge its business, here's how brokerages have reacted:
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Morgan Stanley maintains overweight
Tata Motors share price target: Brokerage Morgan Stanley has maintained its overweight call with a target price of Rs 1,013. The brokerage held that the demerger reflects confidence in the PV business being self-sustaining. It also added that the new strategy can help in better value discovery. JLR and India PV will also have synergies in the electric vehicle era, added Morgan Stanley.
HSBC maintains hold
Tata Motors share price target: HSBC has maintained a hold call with a target price of Rs 920.
Macquarie maintains outperform call
Tata Motors share price target: Macquarie also maintained an outperform call with a target of Rs 1,028, stating that the pure play will enable better value discovery.
The conglomerate structure was constraining valuation upside, while the pure-play format will lend investment flexibility to investors. It further said that the PV segment valuation discount to Maruti could also narrow if Tata delivers on market share gains or better margins.
Nomura on Tata Motors
Tata Motors share price target: Nomura has continued with a buy call. The brokerage has placed the target at Rs 1,057.
JP Morgan on Tata Motors
Tata Motors share price target: JP Morgan maintained an overweight stance with a target of Rs 1,000.
UBS on Tata Motors
Tata Motors share price target: UBS, on the contrary, maintained a sell with a target of Rs 600. The brokerage noted that the company's CV and PV business, which includes India EV and JLR, will simplify the corporate structure, but it does not see any material value. Further, it said it awaits more clarity on other aspects.
Tata Motors share price history
Tata Motors share price target: Tata Motors stock has significantly outperformed key indices with 204 per cent return in the last 36 months versus 50 per cent return in the Nifty on the back of a strong performance across its key business segments, Motilal Oswal Financial Services in a report said.