On Monday, Tata Motors Cracked Over 4% Amid Poor JLR Sales
On Monday, in the morning session, it was seen that the Shares of Tata Motors cracked over 4 per cent amid weakening demand for subsidiary JLR. Investor sentiment dampened on fresh reports suggesting jobs and production cuts at two of JLR’s British factories. Jaguar Land Rover will cut around 1,000 jobs and production at two of its English factories due to fall in sales caused by uncertainty around Brexit and confusion over diesel policy, Reuters reported quoting sources.
According to the sources, this is not a new negative development as cost reduction initiatives are company’s response to the headwinds faced in the US and European markets, Reuters quoted Macquarie as saying.
In the overseas markets it is seen that the Jaguar Land Rover, the engine that keeps Tata Motors going, is showing signs of sputtering. Unfortunately, this will prompt an earnings upgrade estimate for the company. Since January, the Tata Motors stock has lost about 20 per cent. Over the last three months, the JLR projected earnings per share at Tata Motors fell by 38 per cent. It is said that the reasonable valuation is just not sufficient to draw long-term investors back to the stock. The scrip opened at Rs 351.50 and touched intraday high and low of Rs 352.50 and Rs 341.10 respectively, in trade so far.
On BSE, at around 11:50 am, the shares of the company were trading at Rs 342.25, down 4.04 per cent. On 26March, the scrip had touched its 52-week low of 324.50.