Fundamental Analysis of Stocks

Hindalco Industries is an Indian aluminium and copper manufacturing major and one of the top companies in the world, with company valuations of over $26 billion. The company is listed in the Forbes Global 2000 at #643 rank. The Hindalco share price has outperformed its benchmark index- Nifty Metal, over the long term by a good margin.

The recent bullish cycle in metal stocks from March 2020 to March 2022, aided by increased commodity prices, witnessed Hindalco share price rise by over 650 percent.

This blog will look at the long-term outlook of Hindalco share price and critical fundamental parameters to help you make an investment decision. Let’s first look at the company’s history.

History of Hindalco Industries Limited

Hindalco Industries Limited is a metal flagship company of the Aditya Birla Group and has cemented its position as an industry leader in aluminium and copper manufacturing facilities.

The history of Hindalco Industries dates back to the 1950s when the late visionary and architect of the Birla Group, GD Birla, set up India’s first integrated aluminium manufacturing facility at Renukoot, eastern Uttar Pradesh, in 1962. Then, during the tenure of the late Aditya Vikram Birla, Hindalco Industries achieved the pole position in aluminium manufacturing in India.

Under the current leadership of Mr Kumar Managalam Birla, the group chairman, Hindalco became the leader in non-ferrous metals by making strategic acquisitions and expansion of manufacturing facilities. Over the years, Hindalco has expanded its operation out of India and operates in 10 countries with 50 established units.

Hindalco’s combined aluminium and speciality aluminium production capacity is 5.61 million MT. And copper production capacity is 7.46 million MT. It is a consistent profit-making company, and in the FY 2021-22, it achieved a sales turnover of ₹1,95,059 crores and EBITDA of ₹30,056 crores.

Hindalco Product Portfolio

Hindalco Industry’s operation is spread across three different segments aluminium, copper, and chemicals. It also has two R&D centers for undertaking new product development, process refinements, quality assurances, and meeting environmental standards. But first, let’s look at the business of Hindalco Industries.

Aluminum

Hindalco is one of Asia’s largest integrated primary producers of Aluminium, with its own captive bauxite ore mines, mining operations, refining, smelting, and recycling. It manufactures primary aluminium through ingots, wire rods, billets, flat-rolled products, foils and packaging, and extrusions.

Copper

Hindalco’s copper division is known as Birla Copper and operates one of the world’s largest single-location custom copper smelters. In addition, the division manufactures copper cathodes, rods, and precious metals.

Cargo Handling

Hindalco operates an all-weather deep water jetty in Dahej, Gujarat, having an annual cargo handling capacity of 4.5 million MT.

Chemicals

Hindalco manufactures specialized chemicals viz, coarse alumina hydrate, metallurgical alumina, special alumina, and alumina hydrate. The chemicals are exported to a wide range of customers across 32 countries.

Fertilizers

Hindalco can manufacture di-ammonium phosphate (DAP) and Nitrogen Phosphorous Pottasium (NPK). The products are marketed under the brand Birla Balwan.

Acids

Hindalco produces a range of acids that comes from Hindalco’s copper production process. The by-product includes sulphuric acid, phosphorous acid, phosphogypsum, copper slag, and aluminium fluoride.

Hindalco Management Team

The company’s management team is led by Chairman Kumar Mangalam Birla and Mr Satish Pai, the Managing Director.

The company’s copper division is led by Mr Rohit Pathak- CEO of Copper Business. The Chemical business is conducted by Mr Saurabh Khedekar, and Mr Praveen Kumar Maheswari is the Chief Financial Officer.

Mr. Satish Pai is an IIT Madras alumni and was the driving force company’s three mega greenfield projects that established Hindalco as the biggest aluminium producer in Asia. He joined Hindalco in August 2013 as tHindalco’sHindalco’s aluminium business, and in 2016, he became the Managing Director of Hindalco, looking company’s entire value chain.

Before joining Hindalco Industries, Mr Satish Pai spent 28 years at Schlumberger, looking after its global operations.

Hindalco’s Merger and Acquisition

Novelis Inc.

Hindalco Industries acquired Novelis Inc. in 2007 for about $6 billion. It is an Atlanta-based company leading producer of rolled aluminium and aluminium recycling. The company operates as a subsidiary of Hindalco and is listed on both New York and Tronto stock exchanges.

The acquisition helped Hindalco to improve its value chain as the company serves customers in the food & beverages segment, automotive, aerospace, consumer electronics, foils, and packaging.

Aleris

In May 2020, Hindalco, through its subsidiary, Novelis Inc, acquired US-based rolled products major Aleris Corporation at an enterprise valuation of $2.8 billion. The acquisition made Hindalco one of the largest aluminium manufacturing companies in the world. Aleris’s acquisition strengthened Hindalco’s position in other premium product segments, notably aerospace.

Hindalco Industries Financials

Revenue

In the FY 2021-22, revenue from operations was at ₹ 1,95,059 crores, up by 47.78% from ₹ 131,985 crores in FY 2020-21. Hindalco Industries reported a compounded sales growth of 14% in the last five years.

Hindalco Industries has three business segments, Novelis, copper business, and aluminium business, each contributing 65%, 19%, and 16%, respectively, to the revenue in FY 2021-22. In the Q1 FY23, the consolidated income from operations stands at  ₹58,018 crores, up by 40.28% year-on-year.

EBITDA

In FY 2021-22, the EBITDA was ₹30,056 crores, up 59% from ₹18,896 crores in FY 2020-21. In the last five years, Hindalco Industries reported a compounded profit growth is 48%. Segment-wise, Novelis contributed 52%, the aluminium business contributed 43%, and the copper division contributed 5% to the EBITDA.

Profit after tax (PAT) during the FY 2021-22 came at an all-time high level of ₹13,730 crores, compared to ₹ 3,483 crores a year earlier, a y-o-y growth of 294%. In the Q1 FY23 quarter, EBITDA stands at ₹8,640 crores, up 34.16% from ₹6,440 crores in Q1 FY22. While, net profit came in at  ₹4,119 crores, up by 47.79% from ₹2,787 crores a year earlier.

Hindalco Industries Key Ratios

Interest coverage ratio: The consolidated Interest coverage ratio on 31 March 2022 stands at 7.87 times vs. 5.06 times on 31 March 2021. Higher earnings and refinancing Novelis’sf Novelis’s long-term debt helped to improve the interest coverage ratio, strengthening its ability to meet interest obligations.

Current ratio: The consolidated current or liquidity ratio as on 31 March 2022 stands at 1.28x compared to 1.39x the previous year.

Debt-to-equity ratio: The consolidated debt-to-equity ratio as on 31 March 2022 came down to 0.81x from 0.99x a year earlier, reflecting a solid balance sheet position.

Operating and net profit margin: The company’s profitability margin, wherein the operating profit margin in FY 2021-22 improved to 14.61% vs. 13.61% in FY 2020-21. And the net profit margin improved to 7.04% vs. 2.64% in the previous year.

In FY 2021-22, the company continued to invest in building capacities, and the net capital expenditure made during the period was ₹5,355 crores.

Hindalco Share Price Analysis

Shares of Hindalco Industries were listed on 1 August 1997, and the current face value is  ₹1. The shares are listed on the Bombay Stock Exchange, and National Stock Exchange and GDRs are listed on Luxembourg Stock Exchange.

Hindalco share price largely mirrored the metal index or the metal cycle, during which the shares price witnessed sustained growth. As a result, the 5 and 10 years CAGR of Hindalco share price is 13% and 8%, respectively.

Source: tradingview                

Available data shows the Hindalco share price rose from near ₹85 levels at the start of 2004 and is trading closer to the ₹400 level. Moreover, it touched an all-time high level of ₹636 in the recent metal bull cycle.

At the start of this decade, 2020, Hindalco share price made a low of ₹85 on 23 March 2020 due to widespread panic selling in the market caused by the pandemic. After that, however, the Hindalco share price bounced back, giving investors a return of over 600% in the next two years.

Dividend Payout

Hindalco Industries is a consistent dividend-paying company, and in the last three financial years, the company paid ₹4, ₹3, and ₹1 as final dividends to shareholders.

Hindalco Share Price Target

The metal stocks, including Hindalco, are considered cyclical stocks, meaning the price performance of the stocks swings as per the business cycle of an economy. A cyclical stock moves up or down depending on economic growth trends. And Hindalco share price also reflects that trend.

In the short-term, inflationary pressure, fears of recessions, supply chain disruptions, and worsening geopolitical situations can impact global IMFs. As a result, the IMF’s world economic outlook forecasts that global economic growth will slow from 3.2 percent in 2022 to 2.7 percent next year.

However, despite the globalHindalco’s, Hindalco’s Q1 and FY 2023 performance look encouraging in terms of revenues from operations and EBITDA, with 40.28% and 34.16% year-on-year growth, respectively. Nevertheless, volatility and an uncertain business environment have continued to impact  Hindalco share price in the last six months.

Hindalco Share Price Future Growth Potential

Through investments in expanding domestic capacities and acquisitions over the years, Hindalco Industries has helped create a diversified business empire in upstream and downstream segments. In addition, the acquisitions have helped gain technological capabilities in manufacturing premium products. As a result, it has become the cash cow for the company. It is a significant development and can aid in appreciating Hindalco share price.

However, some notable threats can impact the company’s profitability and Hindalco share price in the short term. It includes the risk of global slowdown, falling commodity prices, and a rise in the cost of thermal coal over availability.

Better targeting of opportunities can reduce the impact of threats. For instance, India’s aluminium consumption is less than the global average, increasing demand for aluminum parts in automotive and expansion of the domestic manufacturing market through government initiatives can aid in the growth of Hindalco share price.

The details shared above are based on Hindalco’s quarterly and annual reports and are for information purposes only. However, we suggest doing your due diligence before you make investment decisions.

Disclaimer Note: The stocks and financials mentioned in this article are for information purposes only. They shouldn’t be considered as a recommendation by Research & Ranking. We will not be liable for any losses that may occur.

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Do you know that Tata Power Company Limited has distributed electricity to Mumbai city and its suburbs since 1915? And it is the largest integrated power company in India with power generation, transmission, and distribution services.

Overview of Tata Power

Over the years, the company has evolved to cater to the ever-growing power needs of India. As a result, the company has a 35% of generation capacity through clean and green sources and is committed to achieving carbon neutrality much before 2050.

Not only does the company play a crucial role in securing India’s power needs, but it has also created wealth for its shareholders. In the last three and five years, Tata Power share price has given 61% and 23% CAGR returns, respectively. In addition, it is a consistent dividend-paying company.

Listed on 3 April 1996 on the NSE, Tata Power share price made an all-time high of  ₹298 on 7 April 2022. The stock underwent a split in the ratio of 10:1 on 26 September 2011.

With more than 100 years in operation, Tata Power has witnessed India’s evolving power needs and has successfully kept itself viable with changing customer needs. This blog article will look at the company’s fundamentals and financial metrics and the long-term growth outlook of Tata Power share price.

History of Tata Power

Tata Power was established as a Tata Hydroelectric Power Supply company in 1910. In 1915, the company set up India’s first hydroelectric power generation station at Khopoli with an installed capacity of 40 MW. Since then, the company has grown, contributing plenty of national firsts. For instance, it commissioned India’s first 150 MW thermal plant, India’s first multi-fuel burning generating station, India’s first cross-border hydropower project, commissioned the first 4000 MW mega power plant at Mundra, and more.

Today

The company’s core functions through which it earns significant revenue include generation, transmission, distribution, and renewables. The company also ventured into ramping up EV charging infrastructure and  EPC contracts in recent years.

In FY 2022, the revenue from operations was ₹42,576 crores, registering a growth of 28% y-o-y. And, in the first six months of FY23, the income from operations came in at ₹28,526 crores, posting a y-o-y growth of 43%.

Tata Power Business Performance

Tata Power’s business segment has four parts: generation, renewables, transmission, and distribution. Let’s dive deep into each segment to better understand business performance.

Generation

The company’s generation segment operates under various business models and earns most of its revenue through power sales in the domestic and international markets. In FY 2022, the company earned  ₹11,211 crores in revenue from the generation business, lower by around 20% compared to the previous fiscal year. As a result, EBIT (Earnings before interest and tax) came in at ₹2,632 crores.

One of the key reasons for the fall in generating revenue is the low utilization ratio of Mundra UMPP, which operated at 25% of the capacity in FY 2022 versus 73% in FY 2021 due to higher fuel costs. However, in FY 2023, there has been a considerable increase in generating revenue in the first six months, registering 100% y-o-y growth at ₹9,959 crores. EBIT during the period came in at ₹2,720 crores.

Renewables

In the renewables segment, the company earns revenue through the sale of power, project management services, sale of solar products, and more. In FY 2022, the company earned ₹ 7,748 crores in revenue from the renewables business, up from ₹5,887 crores in FY 2021. EBIT during the period was ₹1,923 crores.

And, in H1 of FY 2023, the revenue came in at ₹ 3,693 crores, up by almost 20% compared to the previous period. EBIT during the period is ₹1,030.72 crores.

Transmission and Distribution

The primary revenue source is through the sale of power to DISCOMs, and other services rendered. In FY 2022, the company earned ₹ 27,493 crores in revenue, which is 63% higher than the previous fiscal year. EBIT came in at ₹2,138 crores.

And, in HI of FY 2023, the company recorded a revenue of  ₹17,978.83 crores, 35% higher than d to the same period last year. EBIT during the period is ₹951.90 crores.

Tata Power Management Team

CEO & Managing Director Dr. Praveer Sinha leads the company. He has over 36 years of experience in India’s Power Generation and Distribution sector and holds a Ph.D. from IIT-Delhi.

Mr. Vijay Namjoshi manages the Power Generation business, and Mr. Ashish Khanna and Mr. Sanjay Banga manage the Transmission & Distribution. At the same time, Mr. Sanjeev Churiwala is the company’s, Chief Financial Officer.

Tata Power Key Financial Ratios

On revenue of ₹42,576 crores in FY 2022, EBITDA during the period came in at ₹8,191 crores, and profit after tax (PAT) is at ₹2,156 crores. The net debt in FY 2022 increased to ₹ 39,708 crores, up by 9.7% in the last one-year period.

Interest Coverage Ratio

The interest coverage ratio stands at 1.31 times, which was 1.30 times in FY 2021. However, the interest coverage ratio could decline based on the revenue and profitability metrics recorded in H1 of FY 2023.

Net Debt to Equity Ratio

In FY 2022, the net debt-to-equity ratio increased to 1.53 times from 1.43 times in FY 21. The increase is due to higher net debt during the period and reduced profit levels.

Current Ratio

The current ratio or liquidity ratio for the budget year ending on 31 March 2022 stands at 0.66 times, and in H1 of FY 2023, it stands at 0.69 times, up from 0.59 times in the same period last year.

Operating Profit and Net Profit Margin

In FY 2022, the operating profit margin was 14%, and the net profit margin (excluding exceptional items) was 7%. And in the H1 of FY 2023, the operating profit margin and net profit margin came in at 15% and 6%, respectively.

Tata Power Share Price Analysis

Over the past year, Tata Power share price has underperformed, which is in line with the broader Indian equity market. As a result, the stock is down by almost 23% from its 52-week elevated level of ₹298.

As of 14 November 2022, Tata Power share price is trying to break above the 200-day moving average (DMA). It is a psychologically important slope for traders, and if the stock successfully clears above the line, it will spur buying and resume its upside momentum.

As the company operates in a highly regulated marketplace, changes in government policy decisions and lack of availability of fuel sources affect the stock price. As a result, the Tata Power share price has shown volatile trends in the past and underperformed the broader market between 2010 and 2020. In May 2020, Tata Power share price made a low of ₹27.

Dividend Payout

Tata Power has consistently paid dividends to its shareholders, and in the last three fiscal years, the company paid dividends of ₹1.75, ₹1.55, and ₹1.55.

Tata Power Share Price Target

Tata Power is on the path toward business transformation through expansion, innovation, and sustainability in focus. The company plans to increase its generation capacity from 13.5 GW to 30 GW in the next five years and reach a customer base of 40 million from the current 12 million. And the addition in capacity will mostly come from clean energy sources. By FY 2030, the company wants to increase its clean energy portfolio to over 80%.

In the next five years, 80% of the capital expenditure will be towards developing a clean and green portfolio. In FY 2023, the company aims to increase ROE to over 12% from 9.5% and reduce net debt/EBITDA to below 1.5 times.

With robust fundamentals, the company will benefit the most from the change in the power sector in India. As a result, many brokerage houses are bullish on the stock and have given an upward revision to Tata Power share price.

Tata Power Share Price- Future Growth Potential

India’s power demand is back above the pre-covid levels, and robust performance in all its business segments has helped Tata Power share price to recover and post substantial gains over the last three years. Some of the key reasons that can improve the company’s financials and increase Tata Power share price are:

• Strong order book in solar rooftop installations and TPPSL’s large EPC order book of ₹15,261 crores at the end of Q2 FY 2023
• Robust performance in the distribution business as the company has been able to reduce AT&C losses by a significant margin in all operating areas
• Expanding its EV charging infrastructure with cumulative installations of 722 EV charges in Q2 and adding 38 cities to the network, taking the total number of cities to 475.

The key risk that threatens the company’s profitability is the increase in fuel costs in thermal generation plants, like the Mundra UMPP, that left the plant idle for a long time. However, the company’s increasing green and clean energy mix to over 80% of the portfolio will reduce risk significantly in the next three to five years, providing stable earnings. Also, sector-specific risks like poor financial conditions and creditworthiness of state-run DISCOMs can derail the sector’s growth, impacting Tata Power share price.

The details shared above are based on the quarterly and annual reports of Tata Power and are for information purposes only. However, we suggest doing your due diligence before you make investment decisions.

Disclaimer Note: The stocks and financials mentioned in this article are for information purposes only. They shouldn’t be considered as a recommendation by Research & Ranking. We will not be liable for any losses that may occur.

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The company that investors and the d-street once gave up on due to its dismal financial performance, deteriorating fundamentals, and consistent decline in stock price is now a case study of a successful business turnaround. Tata Motors share price has given a CAGR of 35% in the last three years and a market cap of $20.25 billion as of November 2022.

So, what has changed for the company, what is the long-term growth outlook, and how much is the upside potential of the Tata Motors share price? We will try to uncover everything in this blog.

Overview of Tata Motors

History

Tata Motors began as Tata Engineering and Locomotive Company  (TELCO) in 1945 as a manufacturer of locomotives. It entered the manufacturing of commercial vehicles in 1954 in collaboration with Daimler-Benz AG and started manufacturing passenger vehicles in 1988 with the launch of the Tata Mobile-206 pick-up vehicle.

Today

Tata Motors is a sizeable international automobile player with a diverse product range, including commercial, passenger, military, electric, and luxury vehicles, and a vehicle financing arm, Tata Motors Finance. In FY 2021-22, the consolidated revenue of Tata Motors was ₹ 2,78,454 crores with an EBITDA margin of 9.6%.

With the size of the business, multiple business heads, and operations spanning over 125 countries, analyzing the business and factors affecting Tata Motors share price becomes highly complex.

We will break down each of Tata Motors business segments to understand the business in a better way.

Commercial Vehicles

Tata Motors is an established player in the commercial vehicle (CV) segment, and its vehicles are not a miss on Indian roads, from the hinterland to expressways. Despite the presence of other major brands, the market share of Tata Motors in the CV segment is 44.9% in FY-2022, up by 2.5% compared to the previous year. The company has improved its market share by 250 bps in the last two quarters.

Tata Motors is a leader in all product ranges, from small commercial vehicles medium and heavy commercial vehicles to buses and vans. In FY 2022, the segment contributed 18.8% to the consolidated revenue. The revenue during the same period registered a year-on-year growth of 57.9% to reach ₹ 52,287 crores, as economic recovery aided the growth. However, EBITDA reported a decline of 150 bps at 3.7%.

In the Q2 of FY 2023, the company’s EBITDA margin improved by 180 bps to reach 5%, despite the global headwinds, rise in commodity prices, and strong US dollar. One of the key emerging growth engines in the CV segment is electric mobility. The company delivered 250+ electric buses in FY 2022 and forayed into cargo E-mobility with the launch of the ACE EV.

Passenger Vehicles

The turnaround in the passenger vehicles segment is miraculous and helped the company to overhaul its image of a dying company that was thriving on the trust of Tatas. By replacing the old product line-up with cars having futuristic designs and top-notch safety levels, Tata Motors was able to win back the trust of Indians.

The segment reported consolidated revenue of ₹ 31,515 crores in FY 2022, a growth of 89.8% Y-o-Y contributing 11.3% to the total revenue. From a market share of just 4.8% in FY 2020, the Tata Motors passenger vehicle segment is now close to becoming the second-largest player, and its market share in H1 FY 2023 is 14.1%.

Also, the segment has become EBITDA positive from FY 2021, and in the Q2 of FY 2023, the EBITDA margin came in at 5.4%, registering a slight decline of 70 bps Q-o-Q. During FY 2022, despite significant supply-side bottlenecks, the company successfully ramped up its manufacturing volumes by 67%, compared to the industry average of 13%.

Electric Vehicles

The one segment that hogged the limelight is the Tata motors electric vehicle segment, with its pace in expanding its product portfolio and sales volume growth.

Tata Motors enjoys the dominant position in the EV market with 87% market share in FY 2022, reporting a 353% Y-o-Y growth in sales volume to 19,105. The company also ramped up its EV charging infrastructure and is present in over 2000 locations.

In FY 2022, the company transferred its passenger EV business to a newly formed subsidiary, Tata Passenger Electric Mobility Limited (TPEML), with an initial capital of ₹ 700 crores and raised $1 billion through TPG global at a $9.1 billion valuation.

Jaguar Land Rover

The luxury vehicles segment contributes 67.4% to the total consolidated revenue and impacts Tata Motors share price the most.

Due to the semiconductor shortage, the segment is witnessing pressure, and the annual sales volume in FY 2022 declined 15.8%, with EBITDA suffering a 250bps decline. Therefore, the company focused on producing high-margin products to drive EBITDA margins.

The Q2 FY 2023 earnings report shows some positive developments. JLR revenue is up 36% year-on-year at £5.3 billion in Q2. Better availability of semiconductor chips also increased volumes by 17.6% y-o-y and 4.9% q-o-q growth.

The division reported a free cash flow of negative £1156 million in FY 2022 and expects to near breakeven in the current fiscal year. Better availability of semiconductor chips can further improve sales volume in the second half of FY 2023. JLR, in its quarterly disclosure, stated that its total order book stands at 205,000 units.

Tata Motors Finance

It is the vehicle financing arm of the business, and commercial vehicle financing is the primary focal point. In FY 2022, its loan book witnessed 5.6% growth to ₹45,220 crores and the Net NPA ratio deteriorated by 180 bps to 5.4%.

Tata Motors Financial Performance

Revenue

During FY 2022, the revenue from standalone business (India operations) came in at ₹ 47,263.68 crores, up from ₹ 30,175.03 crores in FY 2021, marking a turnaround in domestic operations. In Q2 of FY 2023, revenue recorded a 35.93% y-o-y jump at ₹ 14,947 crores. The consolidated revenue (global operations) came in ₹2,78,453.62 crores in FY 2022. And, in Q2 of FY 2023, revenue jumped by 29.7% to ₹79,611 crores.

EBITDA

EBITDA for the standalone business stands at ₹ 747.93 crores in September 2022 quarter, up by 76.02% from ₹ 424.90 crores in September 2021. Tata Motors consolidated EBITDA margin in the FY 2022 was 9.6%.

With improving business conditions and sales, the company is steadily improving its EBITDA margin. In Q2 of FY 2023, the company’s EBITDA margin improved by 130 bps y-o-y to 9.7%. As a result, the auto major narrowed its net losses in the September 2022 quarter to ₹ 944.61 crores from ₹4441.57 crores a year ago.

Key Financial Ratios

Interest Coverage Ratio: The consolidated Interest coverage ratio on 31st March 2022 stands at 0.19 times vs. 1.49 times on 31st March 2021. Lower earnings from both India and global operations resulted in the decline of the interest coverage ratio.

Current Ratio: The current ratio in FY 2022 improved slightly to 0.98 times from 0.93 times in FY 21.

Debt-to-equity Ratio: The debt-to-equity ratio deteriorated further in FY 2022 to 3.13 times from 2.46 times in the previous year. It is due to losses during the year and the increase in consolidated debt by 2.8%.

Operating Profit Margin: The operating profit margin during the FY 2022 declined from 11.86% in the previous year to 8.7%  due to a decline in revenue, a rise in the cost of goods, and manufacturing expenses.

Net Profit Margin: The net profit margin improved from negative 5.36% to negative 4.06% in FY 2022. It was due to low depreciation costs and high one-time exceptional expenses.

Tata Motors Share Price Analysis

Tata Motors shares were listed on BSE in 2000. The company launched its IPO on 3rd January 2000 with an issue price of ₹ 38.64 a share. The stock was split in the ratio of 10:2 on 12th September 2011, and the current face value of the stock is ₹2.

Over the 10 years, Tata Motors share price has underperformed compared to its peers; however, the turnaround in business in the last three years has resulted in stock price growth. As a result, Tata Motors share price has registered a CAGR of 36% in the last three years.

                                        

The Tata Motors share price chart above shows that the stock made a low of ₹63.60 on March 25th, 2020, and is currently trading close to ₹400. The 52-week high for Tata Motors share price is ₹536.70. The company last paid a dividend of ₹0.20 in 2016 and had stopped paying dividends due to losses recorded in the business.

Key Risks

The key risks that could impact Tata Motors share price are:

• CV is a cyclical business, and any downturn in the economy can impact its recovery and growth
• High input costs and delays in price hikes could impact the return to profitability roadmap and goal of zero net debt by 2024
• Global supply chain constraints and shortage of semiconductor chips
• High petrol prices can impact growth in the PV segment

Tata Motors’ investment in future mobility and its plans to launch 10 EVs by 2025 can offset some of the risks in the business, providing an upside to Tata Motors share price.

The details shared above are based on the quarterly and annual reports of Tata Motors and are for information purposes only. However, we suggest doing your due diligence before you make investment decisions.

Disclaimer Note: The stocks and financials mentioned in this article are for information purposes only. They shouldn’t be considered as a recommendation by Research & Ranking. We will not be liable for any losses that may occur.

FAQs

Read more: About Research and Ranking