Following a one-day pause, Tata Motors shares started to decline again on Monday. To settle at Rs 843.05., the shares fell 4.06 per cent. This price represents a 28.50 per cent decrease from its peak of Rs 1,179.05 on July 30, 2024. The stock has increased 6.65% year-to-date (YTD), while the benchmark BSE Sensex has increased 11.20%.
The automaker recorded a 12% drop in sales for the September 2024 quarter (Q2 FY25), selling 2,15,034 units compared to 2,43,024 units during the same period last year. On November 8, Tata Motors is expected to release its second-quarter financial results.
According to WealthMills Securities’ Director of Equity Strategy Kranthi Bathini, the stock has been under selling pressure because of weak vehicle sales. “Investors with a longer-term horizon can hold on to Tata Motors as China’s stimulus package could have a positive impact on JLR (Jaguar Land Rover) sales,” the market analyst said. While JLR receives around 27% of its volume from China, the carmaker receives about 67% of its income from JLR. Technically, the counter’s support was at the Rs 800 level. Nevertheless, an expert advised against bottom-fishing at the present levels.
“Tata Motors has seen a substantial decline from its peak,” stated Osho Krishan, Senior Research Analyst-Technical & Derivatives at Angel One. Significant volatility is indicated by the short-term market structure, with important support located around the Rs 800 sublevels. In the meanwhile, the stock faces a significant challenge in the 920–940 level. Rekindling positive momentum and investor trust in the firm may be possible if a clear break above this level is made.
“Rs 800 will be the support and Rs 887 will be the resistance,” stated Jigar S. Patel, Senior Manager-Technical Research Analyst at Anand Rathi. A clear rise above the Rs 887 mark might lead to a further increase in value above Rs 920. For the near future, the anticipated trading range would be between Rs 800 and Rs 920.
“A formation of lower highs with no indications of recovery characterises the current price structure,” stated Kushal Gandhi, Technical Analyst at StoxBox. At its present prices, we advise against bottom fishing the stock.
The 5-day, 10-, 20-, 30-, 50-, 100-, 150-, and 200-day simple moving averages were all higher than the scrip. The 14-day relative strength index for the stock was 27.42. Oversold is defined as a level below 30, while overbought is defined as a number beyond 70.
According to the BSE, the stock’s price-to-book (P/B) ratio is 10.29 and its price-to-equity (P/E) ratio is 30.55. With a return on equity of 33.69, earnings per share (EPS) were 27.59. In the September 2024 quarter, promoters owned 42.58 per cent of Tata Motors.
