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Bloomberg Quint

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Tata Motors Share Price Hit One-Month Low As Free Cash Flow In FY26 Expected To Be Close To Zero

  • Tata Motors share price hit a one-month low, falling by over 5% to Rs 672.95, the lowest level since May 9.
  • The company signaled that free cash flow for the year is expected to be close to zero, leading to concerns about profitability and cash generation in the near term.
  • Jaguar Land Rover (JLR) shared a muted outlook for the fiscal year and reduced its EBIT margin guidance to 5–7% from the previous 10% expectation.
  • Challenges in the China premium passenger vehicle market, including intense competition and aggressive discounting, have impacted JLR's performance, leading to a downward revision in volumes and margins.
  • Tata Motors aims for JLR's year-on-year improvement in financial years 2027 and 2028, supported by investments and operational streamlining.
  • The company plans significant capital expenditure of approximately Rs 2.09 lakh crore between fiscal 2024 and fiscal 2028 to support its investment roadmap.
  • To counter challenges, Tata Motors reaffirmed commitment to its Enterprise Mission to deliver annual efficiencies and aims to bring JLR back to a 10% EBIT margin target gradually.
  • JLR is preparing for the launch of the first model under the Freelander brand in the second half of the fiscal year ending March 2026.
  • Tata Motors shares also saw a decrease in analyst ratings, with 18 'buy,' 11 'hold,' and 6 'sell' recommendations out of 35 analysts.
  • The average 12-month consensus price target suggests a downside/upside of 10.9% for Tata Motors.
  • The company's shares have fallen 31.32% in the last 12 months and 7.82% year-to-date, with trading volume at 1.2 times the 30-day average.

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