Tata Motors Well Positioned To Navigate Near-Term Challenges, Says ICICI Securities Maintaining 'Add'

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ICICI Securities Report

Jaguar Land Rover hosted its Investor Day on June 16, 2025. Tata Motors Ltd. guided for 5-7% Ebit margin for FY26 (vs 8.5% in FY25). In the US, the company is taking measures including reallocating vehicles to more accessible markets and pricing actions, to help counter the impact from tariffs.

We expect near-term performance in JLR to be strained amid US tariff-related uncertainties, and weak demand trends in China. JLR expects its free cash flow to decline to near-zero in FY26 (compared to £1.5 billion in FY25), before improving YoY in FY27 and FY28, as the new models ramp up. For its domestic business, Tata Motors is focusing on regaining growth momentum via new launches and on margin expansion.

Maintain Add with an SoTP-based target price of Rs 775 (unchanged), implying 11x/2x FY27E India/JLR EV/Ebitda.

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