Tata Motors share price doubles in 2023; is the stock still buy-worthy?

livemint.com:

Tata Motors share price has doubled in 2023, making it the only stock in the Nifty 50 index to achieve this feat this year. Tata Motors share price opened at ₹755 against the previous close of ₹753.90 and jumped 6.5 per cent to hit its fresh 52-week high of ₹802.90 on the NSE in an otherwise weak market. With this, the stock's year-to-date gain surged to 107 per cent.

Despite these sharp gains, the stock remains an attractive buy for the medium to long term as experts expected its JLR (Jaguar Land Rover) segment to do well in the remainder of the financial year, declining debt and improving EBITDA margin in the passenger vehicle (PV) segment. Brokerage firm Sharekhan by BNP Paribas is positive about the stock. It has a buy call on the stock with a target price of ₹840.

"We reiterate our buy rating on Tata Motors as - (1) JLR is expected to perform better in the second half of the financial year 2024 (H2FY24) versus H1FY24, (2) net automotive debt has been consistently declining, (3) EBITDA margin in the domestic passenger vehicle (PV) segment has been improving, and (4) sustaining EBITDA margin in domestic commercial vehicle (CV) space," said Sharekhan. The brokerage firm pointed out that strong festive sales have supported its retail volumes in the PV segment while it expects the domestic CV and PV businesses to perform better in Q4FY24 as compared to Q3FY24. Moreover, Sharekhan believes the expected price hike from January 2024 in the domestic CV segment (up to 3 per cent) would help the company sustain a high-margin trajectory.