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Why Tata Motors Shares are Falling Continuously and When will it Recover?

Tata Motors Chart | Buy sell signal

Why Tata Motors Share is Falling Continuously?

Why Tata Motors Share is Falling Continuously  

For the Last 1 year, Tata Motors stock is falling Continuously.

Currently (11th February 2019) Tata Motors Stock is trading below Rs 150.

In January 2018 Tata Motors Stock was traded around Rs 450. After that, the stock is falling continuously and fall in the vertical path. You can see it in the image.

Tata Motors Chart

On February 8, 2019, Tata Motors declared the Result of the 3rd Quarter of FY19.

  1. Tata Motors reported a net loss of Rs 26,961 Cr.
  2. Domestic Business is doing well, but Jaguar-LandRover reported a loss in the third straight quarter.
  3. Tata Motors are facing stress due to Jaguar LandRover and it is clearly visible in the EBITDA margins.

Financial and Valuations of Tata Motors

Financials and Valuations of Tata Motors

In FY 19, EPS of Tata Motors is negative (-4.4) but it will show a major improvement (21.1) in FY 21. According to the above data, it looks like that in FY 21 the financials of the Company will improve.

Jaguar-LandRover reported a loss in the third straight quarter that’s why a Tata Motors stock is falling continuously since January 2018.

Now the question arises, why Jaguar LandRover is in the loss?

1) The weak sales in China and de-stocking have impacted JLR numbers

2) No Brexit Deal is also unfavourable for JLR.

3) The finance costs increased by Rs 321 crore in Q3FY19

When will Tata Motors stocks go upside?

Currently, the fundamentals and technicals of Tata Motors look out of track. There is not any single positive sign for the stock in the near future. So, It’s very hard to tell when will it recover or go upside.

If you have Tata Motors share then what should you do?

If you have a view of 2 years or less you can exit from Tata Motors because in the next 2 years there is very less possibility that it will go up.

But if you have a view of 3 years or more you can hold the stocks. In the next 3 years, you will see the major upside in Tata Motors.

Why I am advising you to hold the Stock?

  1. Tata Motors is one of the World largest automobile manufacturing companies by volume
  2. Top Commercial Vehicle Producing company in India.
  3. It manufactures across a range of passenger and commercial vehicles.

What are the factors that can lead to an increase in the Share price of Tata Motors?

  1. Increase in the sales of Jaguar Land Rover.
  2. Finalisation of the Brexit Deal will major positive impact on the JLR.

(Note: The stocks mentioned are for reference only and not buy or sell ideas)

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