Rakesh Jhunjhunwala stock: Tata Motors shares hit 3-year high; stock up 25% in 4 sessions – check reason here

Surging for the fourth straight session on Monday, the auto major Tata Motors’ share price touched an over three-year high of Rs 420.75 per share after rallying by 10 per cent on the BSE intraday trade on the back of a strong growth outlook. The stock has hit a new 52-week high for the second session in a row.

The Nifty heavyweight has been trading at its highest level since January 2018 and has jumped over 25 per cent in the last four trading sessions. It also has surged near 40 per cent in the last one month, as compared to a 3.5 per cent rise in the S&P BSE Sensex.

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At around 01:53 pm, The scrip was trading 9 per cent higher at Rs 417.40, against a 0.59 per cent gain in the benchmark index. The trading volumes on the counter jumped over two-fold, with a combined 66.11 million equity shares having changed hands on the NSE and BSE so far.

Tata Motors is the second-most favourite and heavily invested stock of ace investor Rakesh Jhunjhunwala, who is also termed as the Big Bull of the Indian stock market. He held 37,750,000 shares (1.1 per cent stake) worth over Rs 1500 crore in the company, as per the BSE shareholding pattern.

On Friday, while announcing Jaguar Land Rover (JLR) September month retail sales numbers, JLR said that despite the semiconductor shortage impact on production and sales, the company continues to see strong demand for its products with global retail orders at record levels over 125,000 vehicles.  

JLR is a luxury car brand, which includes two prominent names i.e. Jaguar (models like I-pace, etc.) & Land Rover (models like Defender, Evoque, etc)

A global brokerage firm Morgan Stanley maintains an Overweight rating on Tata Motors after JLR’s Q3 update. It pointed out, Tata Motors is seen more as a JLR/global luxury play, but believes the incremental upside surprise will come from its Indian business. 

The brokerage expects 2022/23 to be strong for Indian autos and Tata’s Indian business, and with its lean cost structure, refreshed model portfolio, and high leverage. It has raised the price target to Rs 484 per share and believes Tata Motors will see the highest operating and financial leverage gains.