1:1 Split: Tata's Auto Stock Climbs On Big Demerger Update, Shantanu Naidu Gets Top Role; 18 Brokers Give BUY

1:1 Split: Tata's Auto Stock Climbs On Big Demerger Update, Shantanu Naidu Gets Top Role; 18 Brokers Give BUY

Tata Motors Share Price: Tata Group-backed automobile giant, Tata Motors share price surged for the second consecutive day on February 5th after a big demerger update and late Ratan Tata’s former manager Shantanu Naidu bagging a new top role in the company. In the span of two days, Tata Motors stock has soared by 5.5%. Despite Tata Motors witnessing weak sales and Q3 results, a total of 18 brokerages continue to keep their stance as BUY in this heavyweight stock.

Tata Motors Share Price:

In the early trade of February 5th, Tata Motors’ share price climbed by at least 2.06% to hit an intraday high of Rs 725.35 apiece on BSE. Currently, it has a market cap of nearly Rs 2.64 lakh crore. In the previous session, Tata Motors’ share surged by 3.4% to close at Rs 710.55 apiece. This a sharp jump from below Rs 690 levels in the start of the week.

Together, in two days gaining spree, Tata Motors stock jumped by 5.5% on BSE. The latest upside has also further narrowed Tata Motors YTD losses to 4.2% from last week’s position of 8% downside.

Tata Motors Stock Split:

Group CFO PB Balaji in a media report said that the demerger of Tata Motors into two separate listed companies is progressing well. He revealed that the company is expecting NOC from the Stock Exchange and SEBI anytime soon. Also, he added that the operational activities are in an advanced stage and progressing as per plan, as per the ET Now report.

Further, the report highlighted that Balaji said, if all goes well in the case of dates from the honourable NCLT, then the demerger’s effective date could likely be in October this year.

The company’s demerger will be of two separate listed companies housing A) the Commercial Vehicles business and its related investments in one entity and B) the Passenger Vehicles businesses including PV, EV, JLR, and its related investments in another entity. As part of the demerger plan, Tata Motors shareholders will get 1 share of TMLCV with a face value of Rs 2 each for every 1 share held in the company. This makes the business split ratio to 1:1.

Tata Motors Shantanu Naidu:

Shantanu Naidu, who was the youngest manager to late philanthropist Ratan Tata, has announced through his LinkedIn profile about his new role at Tata Motors.

Naidu said, “I’m happy to share that I’m starting a new position as General Manager, Head – Strategic Initiatives at Tata Motors!” He added, “I remember when my father used to walk home from the Tata motors plant, in his white shirt and navy pants, and I would wait for him in the window. It comes full circle now.”

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Should You Buy Tata Motors Share?

As per Trendlyne data, the consensus recommendation from 30 analysts for Tata Motors Ltd. is BUY. Of the total, 12 analysts have recommended STRONG BUY and another 6 analysts have suggested BUY on Tata Motors share. EPS is expected to reduce by 28.3% in FY25. The average target price on Tata Motors is of Rs 949.73 apiece for 1-year, hinting at over 32% potential upside ahead.

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Original news source Credit: www.goodreturns.in

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