Tata Motors Plunges 6 percent as UBS Warns of Significant Downside Potential

According to UBS, the company’s Range Rover Sport is now heavily discounted, and this trend is projected to continue.

Tata Motors Plunges 6 percent as UBS Warns

In Wednesday’s trading, shares of Tata Motors dropped as much as 6%, with UBS maintaining its’sell’ recommendation on the stock, with a target price of Rs 825. The revised goal indicates a decline of more than 20% from the previous close.

The stock fell as much as 7% intraday on August 5, marking the largest decline in more than a month.

The stock had a 5% decrease in trading at Rs 983.80, or down Rs 51.65 per share, at approximately 12:10 pm.

According to UBS; Tata Motors Plunges 6 percent as UBS Warns

According to UBS, the company’s Range Rover Sport is now heavily discounted, and this trend is projected to continue. Additionally, the brokerage stated that there is a decrease in the market for the company’s new models. The company’s order book is at levels below the Covid period, which is concerning and exacerbates the situation.

For this reason, the brokerage anticipates a negative effect on the company’s financials in FY26 given the substantial discounts and demand for the ICE (internal combustion engine) and hybrid models. Another significant negative risk for JLR is margin slippage.

In tandem, BMW has lowered its 2024 forecast because to the declining Chinese auto market. BMW asserted that despite the government’s efforts to promote the marketplaces. Additionally, the advice has been reduced in light of the costs associated with the product recall due to a brake system defect in up to 15 lakh units. (Tata Motors Plunges 6 percent as UBS Warns)

The performance of Tata Motors’ share price
Over the past year, shares of Tata Motors have increased by 57%.

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