Sell ​​after quarterly results in Tata Motors, should you invest in Rakesh Jhunjhunwala’s preferred stock?

Tata Motors Stocks: Legendary investor Rakesh Jhunjhunwala Tata Motors shares in the portfolio are being sold on May 19. Tata Motors shares have fallen 4.5 percent to Rs 312 today. Whereas it closed at Rs 332 on Tuesday, the day of the quarterly results. In fact, Tata Motors has incurred a loss of Rs 7,585 crore in the March quarter. At the same time, the management has said that due to the second wave of Corona, once again deteriorating situation can affect the business. This has disturbed the sentiment of investors. However, some brokerage houses are still positive about the stock outlook.

Rakesh Jhunjhunwala has more than 4 crore shares

Tata Motors is also among the stocks of choice of Rakesh Jhunjhunwala. Last year, he invested heavily in Tata Motors due to the company’s growth outlook. Currently, he has a 1.3 percent stake in this auto company. Rakesh Jhunjhunwala owns 42,750,000 shares of Tata Motor, with a current value of Rs 1,346.6 crore.

Losses decreased in March quarter

Tata Motors incurred a loss of Rs 7,605 crore in the March quarter. While the expert had expected the company to turn a profit in the March quarter. However, this deficit is less than the year-ago quarter. Tata Motor had a loss of Rs 9,894 crore in the same quarter a year earlier. The company’s revenue grew 41.7 percent to Rs 88,628 crore in the March quarter. Whereas in the same quarter last year, the company’s income was Rs 62,492 crore.

In the entire financial year ended in March 2021, Tata Motors’ has suffered a net loss of Rs 13,395 crore. During its last financial year i.e. FY 2019-20, companies incurred a loss of Rs 11,975 crore. Indian business has been better than expected. But JLR’s business performance has been lower than expected. Management has made a cautious commentary on JLR and Indian business.

covid-19’s impact on business

Tata Motors Management has once again expressed concern over the deteriorating situation due to the second wave of Corona. This may affect the business of the company. So far in the first quarter of FY 2022, the second wave of corona virus has shown an impact on India volume. About 80 percent of the dealerships have been closed during this period. Sales have fallen by 50 per cent in April. In May 2021, worries have increased. This may affect the performance ahead of the company.

What to say about a brokerage house

Brokerage house Motilal Oswal has set a target of Rs 400, recommending buying in the stock. According to the brokerage, Kovid 19 is a concern but in the near term, the company will benefit from macro recovery, company specific volume / margin drivers. Brokerage house CLSA has also given a buy rating in Tata Motors shares and has set a target of Rs 450. While Goldman Sachs has suggested a sale in Tata Motors. The target for the stock has been reduced to Rs 254.

At the same time, UBS has set a target of Rs 360, giving a neutral rating on Tata Motors. Whereas Nomura has advised Tata Motor to reduce yoyers and has set a target of Rs 313. Brokerage house CITI has given a buy rating and set the target for the stock at Rs 395.