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    Tata Motors gains after Q2 results. Should you buy, sell or hold shares now?

    Tata Motors gains after Q2 results. Should you buy, sell or hold shares now?

    Tata Motors gains after Q2 results. Should you buy, sell or hold shares now?
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    By CNBCTV18.com  IST (Published)

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    Tata Motors shares moved higher on Tuesday a day after the auto major's quarterly net loss exceeded analysts' estimates.

    Tata Motors shares were in focus on Tuesday, a day after the auto major's quarterly net loss exceeded Street estimates. The Tata Motors stock gave up most of its initial gains after rising as much as five percent in early deals.
    At  10 am, Tata Motors shares were left with a 1.2 percent gain at Rs 491.5 on BSE, having risen to as high as Rs 510 initially. The headline Sensex index was up 0.1 percent.
    The automaker reported a net loss of Rs 4,415.5 crore for the quarter ended September, as against Rs 307.3 crore for the corresponding period a year ago.  Its revenue, however, rose to Rs 61,378.8 crore in the July-September period, from Rs 53,530 crore in the year-ago period.
    Analysts in a CNBC-TV18 poll had predicted the company's net loss at Rs 3,659 crore over revenue of Rs 59,040 crore.
    Here's what brokerages said after Tata Motors' Q2 results:
    Jefferies
    The brokerage maintained a 'buy' rating on the stock with a target price of Rs 625. The company's EBITDA fell 23 percent sequentially, pulled down by semiconductor shortages at Jaguar Land Rover, but in line with estimates, according to Jefferies. Jaguar Land Rover, which is seeing good demand and has a strong order book, believes that the worst of chip shortages is behind and volumes should gradually improve, the brokerage said.
    A recovery in demand, gains in market share and a better margin should continue to help Tata Motors' India business, it added.
    Motilal Oswal
    Tata Motors should witness a gradual recovery from Q2 lows as supply-side issues ease and commodity headwinds stabilise for its India business, according to the brokerage. The automaker would gain from the benefits of a macro recovery, company-specific volume/margin drivers, and sharp improvement in free cash flow and leverage in both Jaguar Land Rover and the India business, it said.
    Motilal Oswal maintained a 'buy' rating on Tata Motors with a target price of Rs 565/share. The stock trades at 15.2 times its FY23E consolidated P/E and 4.1 times its EV/EBITDA, it said.
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