Tata Motors: A Comprehensive Look at Its Share Performance
1. Overview
Tata Motors Limited, a part of the Tata Group, is a leading global automobile manufacturer headquartered in Mumbai, India. The company produces a wide range of vehicles, including cars, trucks, vans, and buses. It also owns the British luxury car brand Jaguar Land Rover and the South Korean commercial vehicle manufacturer Tata Daewoo1. Tata Motors is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) and is a constituent of the BSE SENSEX and NIFTY 50 benchmark indices1.
2. Recent Results
In the second quarter of FY25, Tata Motors reported a consolidated net profit of ₹3,343 crore, which represents an 11.18% decline year-over-year (YoY)2. The company’s revenue also saw a decrease of 3.5% YoY, amounting to ₹101,450 crore2. Despite these declines, Tata Motors maintained its full-year guidance for Jaguar Land Rover (JLR), expecting improvements in the second half of the fiscal year3.
3. Suggesting Buy Bet at Low Price
Given the recent dip in Tata Motors’ share price, it presents a potential buying opportunity for investors. The stock has shown resilience and growth potential, especially with the company’s strategic initiatives and expected improvements in the latter half of the fiscal year. Analysts have a consensus recommendation to buy, suggesting optimism despite the recent results2. With the current market conditions, investing in Tata Motors at a lower price could yield significant returns as the company navigates through its challenges and capitalizes on future opportunities.
4. Fundamentals
Tata Motors has a strong fundamental base with a market capitalization of ₹3.09 trillion1. The company’s price-to-earnings (P/E) ratio stands at 7.24, indicating that the stock is relatively undervalued compared to its peers1. The return on equity (ROE) is impressive at 49.4%, reflecting efficient management and profitability4. Additionally, Tata Motors has been focusing on reducing its debt and improving its cash flows, which are positive indicators for long-term investors5.
5. Latest Dividends
For the year ending March 2024, Tata Motors declared an equity dividend of ₹6 per share, which translates to a dividend yield of 0.71% at the current share price6. This consistent dividend payout highlights the company’s commitment to returning value to its shareholders. The dividends were split into a final dividend of ₹3 per share and a special dividend of ₹3 per share6.
Recent Dividends
| Announcement Date | Ex-Date | Dividend Type | Dividend (%) | Dividend (₹) | Remarks |
|---|---|---|---|---|---|
| 10-May-2024 | 11-Jun-2024 | Final | 150 | 3.00 | Final Dividend |
| 11-May-2024 | 11-Jun-2024 | Special | 150 | 3.00 | Special Dividend |
| 12-May-2023 | 28-Jul-2023 | Final | 100 | 2.00 | Final Dividend |
| 30-May-2016 | 18-Jul-2016 | Final | 10 | 0.20 | Final Dividend |
| 29-May-2014 | 09-Jul-2014 | Final | 100 | 2.00 | Final Dividend |
| 29-May-2013 | 30-Jul-2013 | Final | 100 | 2.00 | Final Dividend |
| 29-May-2012 | 18-Jul-2012 | Final | 200 | 4.00 | Final Dividend |
| 26-May-2011 | 19-Jul-2011 | Final | 200 | 20.00 | Final Dividend |
| 27-May-2010 | 10-Aug-2010 | Final | 150 | 15.00 | Final Dividend |
| 29-May-2009 | 03-Aug-2009 | Final | 60 | 6.00 | Final Dividend |
| 16-May-2008 | 16-Jun-2008 | Final | 150 | 15.00 | Final Dividend |
| 18-May-2007 | 01-Jun-2007 | Final | 150 | 15.00 | Final Dividend |
| 19-May-2006 | 23-Jun-2006 | Final | 130 | 13.00 | Final Dividend |
| 17-May-2005 | 23-Jun-2005 | Final | 125 | 12.50 | Includes a special dividend of ₹2.50 per share |
| 20-May-2004 | 22-Jun-2004 | Final | 40 | 4.00 | Final Dividend |
| 14-Jan-2004 | 12-Feb-2004 | Interim | 40 | 4.00 | Interim Dividend |
| 27-May-2003 | 30-Jun-2003 | Final | 40 | 4.00 | Final Dividend |
Conclusion
Tata Motors remains a significant player in the global automotive industry with a robust portfolio and strategic initiatives aimed at long-term growth. Despite recent financial challenges, the company’s strong fundamentals and attractive valuation make it a compelling buy for investors looking to capitalize on its future potential.
