DAM Capital has issued a positive outlook on the Indian auto sector, upgrading Tata Motors (TTMT), Escorts, and Bajaj Auto to ‘Buy’ ratings from their previous recommendations. The brokerage expects a recovery in the sector by FY26, driven by favorable macroeconomic factors, despite near-term slowdown concerns.
Key Highlights:
- Upgrades and Target Prices:
- Tata Motors (TTMT): Upgraded to ‘Buy’ from ‘Neutral’, with a target price (TP) of ₹870.
- Escorts: Upgraded to ‘Buy’ from ‘Neutral’, with a TP of ₹3,550.
- Bajaj Auto: Upgraded to ‘Buy’ from ‘Sell’, with a TP of ₹9,750.
- Top Picks:
DAM Capital’s top stock recommendations in the auto sector are:- Mahindra & Mahindra (M&M)
- TVS Motor
- RK Forging
- Recovery Outlook:
The brokerage expects the auto sector to stage a recovery in FY26, supported by favorable macroeconomic trends. However, the near-term outlook remains subdued due to a slowdown in demand across segments.
The upgrades reflect DAM Capital’s optimism about the sector’s long-term potential, driven by anticipated improvements in rural demand, rising disposable incomes, and a favorable policy environment. Companies with diversified portfolios and strong execution capabilities, such as Tata Motors, Escorts, and Bajaj Auto, are well-positioned to benefit from this recovery.
Disclaimer: This article is for informational purposes only. Please consult a certified financial advisor before making any investment decisions.
