Emkay Global has upgraded its recommendation on Tata Motors from ‘Add’ to ‘Buy,’ raising the target price to Rs 1,175. The upgrade comes as the brokerage sees a positive demand and margin outlook for the company’s domestic commercial vehicle (CV) business.
While China remains a relatively smaller market for Tata’s Jaguar Land Rover (JLR) unit, Emkay noted that the company’s profitability and deleveraging story remain largely intact. The demand outlook for passenger vehicles (PVs) is also promising, with Tata Motors better positioned than the industry average due to new launches and lower inventory levels.
Emkay is optimistic about Tata Motors’ healthy profitability outlook and views the stock’s valuation as undemanding, making it an attractive investment at this juncture.