Tata Motors Stock Analysis: Buy, Sell, or Hold After 30% Q1 Profit Decline?

The shares of the automobile giant Tata Motors Ltd observed an uptick during the early trade session on Monday, August 11, 2025, despite the Tata group firm reporting a 30% decline in its net profit for the quarter ended June 30, 2025.

Tata Motors Performance

Tata Motors' performance was impacted by volume decline in all business and a drop in profitability primarily at Jaguar Land Rover (JLR), the company said.

According to the firm, Donald Trump's tariff impacted the luxury automaker's revenues, which were down over 9% to £6.6 billion, with EBIT margin declining 490 basis points (bps) to 4%.

Tata Motors Shares

The shares of Tata Motors were trading at Rs 637.85 per equity share, by 0.6% on the NSE, at 9:25 am.

At around 11:23 am, the shares were trading at Rs 652 per equity share or 2.95% higher on the BSE on Monday as compared to its previous close of Rs 633.30 on Friday.

Tata Motors Share Price Target

The shares of Tat Motors are likely to 'underperform' in the near-term, leading the international brokerage firm Jefferies to cut its price target to Rs 550 per equity share.

The factors behind this include rising competition, China tax, warranty costs, and aging models at JLR, while noting market share losses and margin pressure in India's passenger vehicle segment, weak commercial vehicle demand, and concerns over the Iveco acquisition.

The brokerage also cut FY26–28 earnings per share (EPS) estimates by 8–15%.

According to Nuvama Institutional Equities, a muted growth is also expected for Tata Motors' JLR, forecasting just 1% CAGR (compound annual growth rate) due to Jaguar model discontinuations, weak China and Europe sales, and US tariffs.

The commercial vehicle business in India is also likely to see only 1% CAGR on a high base, reasonable transporter utilisation and railway competition.

Despite several attempts at saving costs, muted demand and rising marketing spends are expected to limit EBITDA CAGR to 4% over FY25-28E.

Therefore, Nuvama has retained its 'reduce' rating, cutting its target price to Rs 610, down from Rs 670 earlier.

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