The company expects single-digit growth in both the domestic commercial vehicle (CV) and passenger vehicle (PV) segments in financial year 2025-26 (FY26).
Tata Motors is targeting a 40% market share in the CV segment by FY27, up from 36% in FY25, driven by new product launches and a recovery in the small commercial vehicle (SCV) category.
In the PV segment, the company aims to increase its market share to 16% by FY27, from 13% in FY25, supported by new launches and a rebound in demand for cars.
For the domestic PV business, Tata Motors plans to launch seven new models by FY30, including the Sierra, the Avinya range, two new internal combustion engine (ICE) models, and two new electric vehicles (EVs).
In terms of financials for FY27, Tata Motors expects the CV segment in India to generate free cash flow (FCF) equivalent to 7-9% of sales. The PV (ICE) business will likely generate an FCF of around ₹1,000 crore, while the PV (EV) segment is expected to post negative free cash flow.
What analysts recommend
Global brokerage firm Nomura has a ‘Neutral’ rating on Tata Motors, with a price target of ₹799 per share.
The foreign brokerage believes execution on expanding SCV market share will be a key area to watch. Strengthening the SCV segment is seen as critical to achieving the overall market share target outlined by management.
Investor feedback also suggests that a key potential driver for Tata Motors’ stock could be the upcoming JLR guidance on June 16.
Meanwhile, Jefferies, which has an ‘Underperform’ rating and a price target of ₹630, acknowledged Tata’s strategic priorities but flagged ongoing concerns about multiple headwinds across its business segments.
Nuvama expects JLR sales to moderate going forward, citing weak demand trends in the US and China. Given the subdued outlook for India’s commercial vehicle segment, it has maintained a ‘Reduce’ rating on the stock with a price target of ₹670.
Emkay Global maintains a ‘Buy’ rating with unchanged price target of ₹800.
According to Emkay, Tata Motors’ CV business is on a strong footing, on robust profitability-led growth amid a potential demand recovery in the CV cycle. PV business performance, though, will be muted amid a weak industry demand environment and lukewarm response to recent launches.
Of the 35 analysts that have coverage on Tata Motors, 18 of them have a ‘Buy’ rating, 11 say ‘Hold’, while six have a ‘Sell’ rating on the stock.
Tata Motors shares ended 0.91% higher on Monday at ₹717.50. The stock has recovered 34% from its 52-week low of ₹535.
