Tata Motors shares hit 10% lower circuit on chip shortage news

Shares of Tata Motors dipped sharply on the stock market on Tuesday.

As per the latest reports, the shares of Tata Motors has come down sharply on the stock market on Tuesday. The company’s shares fell by 10 percent on the National Stock Exchange and more than 8 percent on the Bombay Stock Exchange. According to the reports of India Today, at 2:48 pm, shares of Tata Motors were down 8.29 percent at Rs 317.35 on the BSE.

The company indicates a significant deterioration in performance, given the margins it achieved in the fourth quarter of last year and also in the whole of FY21.

The company has lowered its expectation for JLR due to the global chip shortage issue. The company has also said that chip shortage will be greater by the second quarter in comparison to the first quarter of FY22.

It also added that the wholesale volumes will be lower than 50 percent of what was planned earlier due to the chip shortage. Tata Motors has expected the situation to improve by the second half of FY22.

Besides the company also said in its commentary that the demand will remain strong and high, and the chip shortage issue can negatively impact the company’s result in a cash outflow with approximately one billion pounds with negative EBIT margins by Q2.

Because of these reasons, it has seen a sudden fall in Tata Motors stock today.

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