CLSA has retained sell rating on the stock with a target price at Rs 330 per share as operational outlook remained clouded given subdued demand. "Weak product cycle and rising competition in premium SUVs is a worry."
Tata Motors share price declined 1.37 percent to 353.40 on Tuesday after Kotak Securities slashed target price on the stock and CLSA retains sell rating on the stock.
The weakness in UK/Europe has impacted Jaguar Land Rover (JLR) sales and volumes declined by 8 percent YoY in March while outperformance by new models offset by steep decline in volumes of existing models, Kotak said while lowering JLR's volume & margin estimates to factor in demand slowdown in developed markets.
The research house has cut target price to Rs 465 (from Rs 520 earlier) and lowered FY2019-20 consolidated EPS estimates by 17-22 percent, though it has maintained Buy rating.
Kotak expects JLR's overall volume to increase 3.5 percent YoY in FY19 led by growth in China JV. "We build in 6.3-6.4 percent EBIT margin for JLR in estimates and increased FY19-20E standalone EBITDA estimates by 6-12 percent."
Meanwhile, CLSA has retained sell rating on the stock with a target price at Rs 330 per share as operational outlook remained clouded given subdued demand. "Weak product cycle and rising competition in premium SUVs is a worry."