The Bonafide Outlook of Tata Motors: 200 Rupees by 2020?
Current Context of Tata Motors
As of now, the Tata Motors share price stands just shy of the 200 Rupee mark, with only a 10-11 day trading period left in 2020. This could be a critical period where a bullish trend even on a single day is enough to fill this gap. The recent talks around Brexit have been anything but certain, but if any developments favor Tata Motors, the stock might experience a surge to the 200 Rupees mark. However, patience and a well-informed approach are key in this volatile market.
Factors Influencing Tata Motors Stock
The current bull market environment makes it possible for Tata Motors to reach 200 Rupees, but other factors like recent Q2 results and the performance of its subsidiary Jaguar Land Rover (JLR) are crucial. If Q2 results prove to be better and if JLR can reduce its losses, the stock could easily breach the 150 Rupees level within the next five months. Considering historical trends, the stock is projected to rise to 160 or 180 during the Diwali period as it did in the past.
Challenges Faced by Tata Motors
However, the auto market is currently facing challenges due to lockdowns and overall economic conditions. This has directly impacted the company's sales and revenue. Additionally, Tata Motors has lost some of its market share and may need to exit current positions during rallies. Despite these challenges, at the current 113 Rupees price, there is little risk, and I predict the stock price is unlikely to reach 150 Rupees in the next year.
Long-Term Perspective and Fundamental Analysis
From a long-term standpoint, Tata Motors has shown a weak fundamental strength with a -175.45 CAGR (Compound Annual Growth Rate) in operating profits over the last five years. This is a significant downturn, diminishing the overall growth potential of the company. While Maruti Suzuki is currently a moderately attractive option, and Mahindra Mahindra is quite expensive, investing in Tata Motors still carries inherent risks.
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While the possibility of reaching 150 Rupees in the next year is not impossible, especially with supportive environmental factors, the broader outlook suggests that until these factors align strongly, Tata Motors' current trading price is in a steady but challenging position.
Conclusion: Tata Motors' share price has the potential to reach 200 Rupees by the end of 2020, particularly if there are positive movements in the market. However, patience and a well-thought-out strategy are crucial. Always consider risks and consult with a financial advisor before making any investment decisions.
Disclaimer: The information provided above is for educational purposes only and should not be considered as trading or investment advice.