Tata Motors Ltd has returned to the limelight following a good 9% rise in only two trading sessions, closing Thursday at ₹704, up 3.45% intraday. This recent jump has taken the stock to a new short-term high, with much of the buying spurred by hope over the India-UK Free Trade Agreement (FTA) and positive strategic news for its UK-based subsidiary Jaguar Land Rover (JLR).
India-UK FTA: The Driving Force for Tata Motors’ Global Push
The major reason for the stock’s recent strength is the India-UK FTA announcement made by Prime Minister Narendra Modi. As part of the agreement, car tariffs are likely to be reduced from 100% to only 10% under a quota regime.
As per SEBI-registered analyst Mitesh Panchal, this deal would be a key growth driver for Tata Motors:
“Tata Motors will be a clear beneficiary of the FTA. Investors should accumulate in the ₹680–₹700 zone. Near-term targets could be ₹780–₹820.”
JLR’s Exports to Get a Boost — Especially in EVs
The FTA will also make it easier for JLR to export electric vehicles (EVs) from the UK to India, something that would fit nicely into Tata Motors’ larger EV plans. To this, JLR is setting up a new plant in Tamil Nadu where it will co-develop models for both local and export markets.
Rajesh Sinha, Senior Research Analyst at Bonanza, stated:
“The FTA enhances economic links and reduces the cost of imports. It will support Tata Motors’ EV export plans through JLR.”
Attractive Valuation and Long-Term Confidence
WealthMills Securities Director of Equity Strategy Kranthi Bathini opines that the stock is underpriced from a medium- to long-term point of view, and hence the rally may have more legs.
“Those in possession of the stock should stay on and look to add on dips.”
Business Restructuring: Two Listed Entities to Unlock Value
Tata Motors also received shareholder nod to demerge its automotive business into two independent listed companies-one for passenger and the other for commercial vehicles. This demergence is with the objective to unlock value and give equal ownership in both businesses to shareholders.
JLR and China Exposure: A Balanced Global Play
Today, 67% of the revenue of Tata Motors is contributed by JLR, while JLR derives 27% of its volume from China. This provides the company with extensive global exposure while retaining robust domestic traction within India.
Promoter Confidence Intact
As of March 2025, the Tata Group’s promoter holding stands at 42.58%, indicating confidence in the growth track and leadership vision of the company that continues unabated.
What Should Investors Do Now?
With:
- A strong FTA in place
- Strategic EV and manufacturing strategies,
- Attractive valuations, and
- Shareholder-friendly restructuring actions,
Tata Motors seems poised for more upside. Analysts recommend accumulation on dips and a look out for a breakout to ₹780–₹820 in the near future.
Key Takeaways:
- Tata Motors shares rose 9% in 2 days, touching ₹704
- FTA with the UK reduces auto tariffs from 100% to 10%
- JLR’s EV exports and new Tamil Nadu factory seen as growth drivers
- Valuations attractive; more upside likely
- Share split into two listed units ratified by shareholders
- Promoter holding remains firm at 42.58%
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