Tata Motors— Profit Focus Intact But Global Headwinds Persist For JLR, Says Motilal Oswal, Maintaining Neutral

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Motilal Oswal Report

We met with the Tata Motors Ltd.'s management, and the key takeaways of the same are as follows:

The house of brands strategy is proving successful, with its top three models now well differentiated. It plans to position the Discovery brand accordingly.

Going forward, the focus will be on profitable volume growth, without any major focus on market share. Management has maintained its FY25 guidance, unlike most other OEMs that have issued profit warnings.

In the Indian commercial vehicle segment, while the business has performed well across most parameters, the primary focus would be on regaining lost share in small commercial vehciles.

In the Indian passenger vehicle segment, apart from upcoming new launches, the company will focus on improving its service capabilities. However, we continue to remain on the sidelines regarding this company, given the uncertainties around threat from potential US tariff levies, weak global macro conditions, and the ramp-up of margin-dilutive EV business.

In the absence of any triggers, we reiterate our Neutral stance with Dec’26E SOTP-based target price of Rs 705.

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