Bet on Tata Motors?

I have been thinking of accumulating Tata Motors. The negatives on the company right now is the sluggish growth on JLR and CV segment along with competition coming from Eicher, Mahindra etc., but on the positive side the stock seems attractively valued right now, along with that top class management, ethical company policies, big group, 60% market share and defense and heavy CV pick up being seen in the medium to long term. Seems like a lucrative investment option for 2-3 years. Thoughts/comments/opinions?

 

If you are thinking of investing in TM you should probably forget about TM and think of it as JLR. Much of the revenues and profits of the company now comes from Jaguar and Land Rover sales worldwide, The total mix of CV now is very low although I am not sure of the exact ratio but the reason the stock has gotten down so much is because of poor economic conditions or a slowdown in China which is probably the biggest market for JLR. Nevertheless Jaguar and Land Rover are iconic brands in the world market and Tata has managed to turn them around.. However the price rise of this stock would depend heavily on Chinese or International market sales number of JLR.

 

Agree with the JLR analysis but I think the CV segment is where TM has a major chunk of the market. The CV market itself might be slow right now, but eventually when it picks up it should do good. I think whats really killing TM right now is the passenger vehicle segment (I mean Nano, Indigos etc.) where it is making a lot of losses. In any case, what I wanted to understand was maybe this downturn is a great opportunity to accumulate in big chunks?

 

Well my personal belief is that TM has suffered recently more because of slowdown in JLR numbers than with anything else and because JLR is such a huge portion of it's revenues and profits it has caused the stock to get low.

 

True TM get huge JLR money, but the other point is also valid (passenger cars). But fair enough. Its times like these that a person can really get these top quality stocks. I feel that there's a turnaround around the corner within 1-2 years.

 

Hold on your breath's guys !

China contributes 25% to JLR sales and when it comes to marketing they have again got it wrong,2nd time wrt to marketing Evoque in china with Super sweet cherry. (1st time was with our very sweet NANO, even Ratan tata admitted this).

Now read this, https://www.carscoops.com/2015/07/landwinds-x7-range-rover-evoque-clone.html

hope it helps

 

I think the focus is too much on the JLR demand, the upcoming opportunities in India itself seems huge. There are opportunities opening up in Infra, Mining, Logistics, Transport, Defense and Luxury vehicle segment. Tata has a huge brand and 60% market share in these areas. Currently the volumes are not picking up in CV segment because the govt. has not started spending in these areas. Next year its going to be all for Infra and Heavy CV companies I think. JLR is eventually going to pick up, because its a brand which sells. You can also buy a similar looking Mahindra XUV, but for people who go for brand they'll buy a JLR.

 

a jv with wolkswagon will be game changer in car segment