Tata Motors’ stock remains a key focus for investors after its Q3 FY25 earnings, with CLSA maintaining an ‘Outperform’ rating and setting a target price of ₹930, implying a 23% upside from the current market price of ₹754.80.
Despite concerns over weak demand in China and rising variable marketing expenses (VME) costs, CLSA noted that JLR remains confident of delivering an EBIT margin of around 10% in Q4, which would bring its full-year margin to approximately 8.5%. The firm highlighted that Tata Motors’ management remains optimistic about the commercial vehicle (CV) segment, expecting a stronger performance in Q4.
CLSA also pointed out that demand for higher-margin models such as the Range Rover Sport and Defender continues to act as a tailwind, offsetting some of the near-term headwinds from China and Europe. However, due to subdued demand in these regions, the brokerage cut its JLR FY26 volume estimate by 5%.
Tata Motors’ management believes that a combination of scale, a better product mix, and lower warranty costs will drive improved profitability in the coming quarters. Investors will be closely watching whether the company can meet its guidance targets as it navigates global macroeconomic challenges.
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