Tata Motors Crashes to 52-Week Low! ₹2 Lakh Crore Wiped Out—Will It Bounce Back?

Tata Motors’ stock hit a fresh 52-week low of ₹630.15, marking a 46% decline from its peak and erasing nearly ₹2 lakh crore in market value. The downturn is driven by weak Jaguar Land Rover (JLR) demand in key markets like China and the UK, along with concerns over potential US import tariffs. Passenger and commercial vehicle sales are expected to decline by 7.3% and 3.3%, respectively, in February 2025. Despite short-term headwinds, CLSA maintains a BUY rating with a ₹930 target price, citing a potential cyclical recovery in FY27. Tata Motors’ upcoming demerger and stock split could unlock long-term value for investors.

CONTENTS:

• Tata Motors Live Stock Updates (February 28, 2025)
• Demerger & Future Outlook
• CLSA’s Investment Analysis & Concerns
• Investment Outlook: Short-Term Headwinds, Long-Term Potential

Tata Motors Crashes to 52-Week Low! ₹2 Lakh Crore Wiped Out—Will It Bounce Back?

Stock Performance & Market Trends

Tata Motors’ share price continued its downward trend for the ninth straight session on February 28, reaching a new 52-week low of ₹630.15 on the BSE. The stock has plummeted over 46% from its peak, wiping out nearly ₹2 lakh crore in market capitalization.

The decline is primarily driven by weak demand for Jaguar Land Rover (JLR) in key markets like China and the UK, along with sluggish domestic passenger vehicle sales. Additionally, concerns over potential US import tariffs on European-made vehicles pose risks to JLR’s US sales, which contribute 25% of its retail volume.

As per Motilal Oswal Financial Services, Tata Motors’ auto sales for February 2025 are projected to decline 5.7% year-on-year (YoY) to 81,505 units, with:

• Passenger vehicle sales down 7.3%
• Commercial vehicle sales down 3.3%

From a technical standpoint, the stock previously failed to sustain a breakout at ₹1,065 and has now reached its downside target of ₹659, struggling to hold at support levels. Analysts see ₹589 as a key support level, with a potential retest if selling pressure persists.

Despite recent losses—down 13% in a month, 15% YTD, 41% over six months, and 34% in a year—Tata Motors has delivered long-term gains of 50% over two years and 390% in five years.

As of 10:20 AM, the stock was trading 2.18% lower at ₹634.10, with a market capitalization of ₹2.33 lakh crore.

Tata Motors Live Stock Updates (February 28, 2025)

Latest Price & Market Metrics

• Current price: ₹630.3 (-2.77%)
• Market capitalization: ₹2,32,996.8 crore
• Trading volume: 66,67,954 shares
• P/E ratio: 7.34
• EPS (TTM): ₹86.3

Over the past three months, the stock has dropped 17.27%, with a 9.05% decline in the last month, reflecting ongoing market pressure.

Technical Analysis & Key Support Levels

• The stock is trading below its second support level (S2) of ₹672.42, currently at ₹633.60.
• The 3-day simple moving average (SMA3) is ₹667.67, indicating a continued downward trend.
• A new 52-week low of ₹630.15 was recorded, breaking the previous low of ₹717.7.

Recent Price Movements

• 10:50 AM – Trading at ₹631.85, down 2.58%.
• 10:19 AM – Trading at ₹634.0, reflecting a 2.25% decline.
• 09:31 AM – Breached support levels, trading at ₹633.60.
• 08:16 AM – Weekly return at -5.98%, indicating a tough trading period.

Demerger & Future Outlook

Tata Motors is undergoing a demerger, creating two separate listed entities:

1. Commercial Vehicles (CV) business and related investments.
2. Passenger Vehicles (PV) business, including EVs and Jaguar Land Rover (JLR).

Under the 1:1 split, shareholders will receive one share of TMLCV (Commercial Vehicles) for every Tata Motors share they own. The demerger is expected to be effective by October 2025.

CLSA’s Investment Analysis & Concerns

CLSA has maintained a bullish outlook despite the stock’s decline, retaining a BUY rating with a target price of ₹930 per share.

However, key investor concerns include:

• Weak JLR demand in China, the UK, and Europe.
• Potential US import tariffs, which could affect JLR’s US sales.
• Challenging margin targets, with 10% EBIT guidance looking difficult to achieve.
• Sluggish growth in the Heavy Commercial Vehicles (HCV) segment, impacting profitability.
• Rising competition in the PV and EV markets, posing risks to market share.

At current levels, JLR is trading at a steep discount, reflecting uncertainty in its business outlook. CLSA expects a 5% decline in Medium & Heavy Commercial Vehicle (M&HCV) sales in FY26, but foresees a cyclical recovery in FY27, potentially boosting Tata Motors’ valuation.

Investment Outlook: Short-Term Headwinds, Long-Term Potential

Despite immediate challenges, CLSA maintains a ₹930 target, implying potential upside. Investors should monitor:

• JLR’s retail demand and discounting trends.
• US tariff policies on European imports.
• Competitive landscape with Chinese EV manufacturers.

While short-term risks remain, Tata Motors’ long-term prospects post-demerger could present growth opportunities, making it a value-buy for investors.