Prepared by-:

Hargun Wadhwa
(Junior Analyst)

RESEARCH
REPORT
Market cap: 3.52 trillion
CMP: Rs 960.00
 INTRODUCTION
Tata Motors Limited is an Indian multinational automotive company headquartered in Mumbai and part of the Tata Group.
Founded in 1945, Tata Motors initially focused on locomotive manufacturing but expanded into the commercial vehicle sector
in 1954 through a joint venture with Daimler-Benz of Germany. The company entered the passenger vehicle market in 1991
with the launch of the Tata Sierra, a sport utility vehicle based on the Tata Mobile platform. Over the years, Tata Motors has
made significant acquisitions and partnerships, including Jaguar Land Rover, Tata Daewoo, and Hispano Carrocera, among
others. Today, Tata Motors is a leading global manufacturer of cars, utility vehicles, buses, trucks, and defence vehicles, with a
global footprint and a network of subsidiaries and joint ventures across various countries.
Tata group founded by Jamsetji Tata in 1868, Tata Motors is among the world’s leading manufacturers of automobiles. Tata
believe in ‘Connecting aspirations’, by offering innovative mobility solutions that are in line with customers' aspirations. They
are India's largest automobile manufacturer, and they continue to take the lead in shaping the Indian commercial vehicle
landscape, with the introduction of leading-edge powertrains and electric solutions packaged for power performances and user
comfort at the lowest life-cycle costs. There new passenger cars and utility vehicles are based on impact design and offer a
superior blend of performance, driveability and connectivity.
There focus on connecting aspirations and our pipeline of tech-enabled products keeps us at the forefront of the market. We
have identified six key mobility drivers that will lead us into the future – modular architecture, complexity reduction in
manufacturing, connected & autonomous vehicles, clean drivelines, shared mobility, and low total cost of ownership
There mission - across our globally dispersed organisation – is to be passionate in anticipating and providing the best vehicles
and experiences that excite our global customers.
 HISTORY OF THE COMPANY
Early Years (1945-1954):
• 1945: Tata Sons acquires the E.I. Railway Workshop, marking the official beginning of Tata Motors (TELCO).Their initial
task was assembling imported wagons for the Indian railways.
Commercial Vehicle Focus (1954-1991):
• 1954: Collaboration with Daimler-Benz proves to be a turning point. The first Tata Mercedes-Benz truck rolls out , laying
the foundation for their dominance in the Indian commercial vehicle market.
• 1960s & 1970s: Focus on indigenization. Tata Motors develops its own engines and technologies, reducing dependence on
foreign collaborations.
Passenger Vehicle Entry & Growth (1991-2008):
• 1991: The Tata Sierra, their first passenger vehicle, enters the market.
• 1998: The iconic Tata Indica, a budget-friendly hatchback, disrupts the Indian car market.
• 2000s: Continued innovation with models like the Tata Safari (SUV) and Indigo (sedan).
Global Acquisitions & Expansion (2008-Present):
• 2008: The landmark acquisition of Jaguar Land Rover transforms Tata Motors into a global automotive player.
• 2004: Tata Motors acquires Daewoo's commercial vehicle unit in South Korea, strengthening their commercial vehicle
portfolio.
• 2010: Focus on electric vehicles (EVs). Tata Nexon EV becomes India's best-selling electric car.
Beyond Vehicles:
• Tata Motors actively participates in the Indian defense sector, manufacturing military vehicles.
• The company emphasizes sustainability and social responsibility through various initiatives.
 PRODUCTS OFFERED
Passenger Vehicles
1. Cars
• Tata Tiago: A compact hatchback.
• Tata Tigor: A compact sedan.
• Tata Altroz: A premium hatchback.
• Tata Nexon: A subcompact SUV.
• Tata Harrier: A mid-size SUV.
• Tata Safari: A full-size SUV.

2.Electric Vehicles (EVs)

• Tata Nexon EV: An electric version of the Nexon SUV.
• Tata Tigor EV: An electric version of the Tigor sedan.

Commercial Vehicles
Trucks
• Tata Ace: A mini-truck.
• Tata LPT 407: A light commercial truck.
• Tata Prima: A range of heavy-duty trucks.
• Tata Signa: A range of heavy-duty trucks.
 MAJOR SUBSIDIARIES
• Jaguar Land Rover (JLR): Acquired by Tata Motors in 2008, JLR is a British multinational
automotive company that designs, manufactures, and sells luxury vehicles under the Jaguar and Land
Rover brands. JLR has been a significant contributor to Tata Motors' global presence and revenue.
• Tata Daewoo Commercial Vehicle Company (TDCV): Based in South Korea, TDCV is one of the
largest manufacturers of heavy-duty trucks in the country. Tata Motors acquired Daewoo Commercial
Vehicle Company in 2004, expanding its commercial vehicle segment.
• Tata Motors European Technical Centre (TMETC): Located in the UK, TMETC is a research and
development center focused on automotive engineering and innovation. It plays a crucial role in
developing new technologies and products for Tata Motors.
• Tata Hispano Motors Carrocera S.A.: This subsidiary is based in Spain and specializes in the
manufacture of bus and coach bodies. It enhances Tata Motors' capabilities in the bus segment,
particularly in the European market.
• Tata Motors Finance Ltd. (TMFL): TMFL is the financial arm of Tata Motors, providing financing
solutions to customers and dealers. It supports the sales and distribution network of Tata Motors by
offering loans, leases, and other financial services.
• Concorde Motors (India) Ltd.: A wholly-owned subsidiary, Concorde Motors focuses on sales,
service, and spare parts distribution for Tata Motors vehicles in India.
• Tata Technologies: This subsidiary offers engineering and design services to the automotive, aerospace,
and industrial machinery sectors. It supports Tata Motors in various aspects of product development and
innovation.
 MAJOR COMPETITORS
Passenger Vehicles
1. Maruti Suzuki: The largest car manufacturer in India, known for its wide range of affordable and reliable vehicles.
2. Hyundai Motor India: A key player in the Indian market with a strong lineup of compact and mid-sized cars.
3. Honda Cars India: Competes with Tata Motors in the sedan and SUV segments.
4. Mahindra & Mahindra: Another major Indian automaker with a strong presence in the SUV and utility vehicle segments.
5. Toyota: Known for its reliable and durable vehicles, Toyota competes in various segments, including sedans and SUVs.
Commercial Vehicles
1. Ashok Leyland: One of the largest manufacturers of commercial vehicles in India, competing directly with Tata Motors in trucks and buses.
2. Eicher Motors: Known for its commercial vehicles, especially in the medium and heavy-duty segments.
3. Mahindra & Mahindra: Competes in the light commercial vehicle segment.
4. BharatBenz: A brand of Daimler India Commercial Vehicles, offering a range of trucks and buses.

Luxury Vehicles
1. BMW: Competes with Jaguar Land Rover in the luxury car segment.
2. Mercedes-Benz: A major competitor in the luxury and premium vehicle market.
3. Audi: Competes with Jaguar Land Rover in the luxury and performance vehicle segments.
4. Volvo: Known for its safety and luxury features, competing in the premium vehicle market.
Electric Vehicles (EVs)
1. Tesla: A global leader in electric vehicles, setting benchmarks in technology and performance.
2. Mahindra Electric: One of the early entrants into the Indian EV market.
3. Hyundai: Offers electric models like the Kona Electric, competing in the EV space.
4. MG Motor: Known for its electric SUV, the MG ZS EV, in the Indian market.
BOARD OF DIRECTORS
 SWOT ANALYSIS
Strengths
• Strong brand reputation as part of the prestigious Tata Group.
• Diverse product portfolio spanning passenger vehicles, commercial vehicles, and electric vehicles.
• Focus on innovation with significant R&D investments.
• Global presence with manufacturing in multiple countries and exports to over 125 markets.
• Acquisition of Jaguar Land Rover providing access to luxury segments and cutting-edge technologies.
• Vertical integration within the Tata Group enabling cost efficiencies and supply chain optimization.
• Skilled workforce with expertise in design, manufacturing and marketing.
Weaknesses
• Heavy reliance on the Indian domestic market.
• Relatively small global market share compared to major competitors.
• Slower adoption of electric vehicles compared to some competitors.
• Vulnerability to economic downturns and industry cycles.
 Opportunities

• Growing demand for electric vehicles in India and globally.

• Expansion into new international markets.
• Increasing focus on shared mobility and transportation services.
• Leveraging digital technologies to enhance customer experience.

Threats
• Intense competition from established global automakers.
• Potential disruption from new entrants and technologies.
• Increasing environmental regulations and emission standards.
• Volatility in commodity prices and foreign exchange rates.
• Shared mobility trends potentially reducing car ownership.
• Trade barriers like tariffs and trade wars impacting overseas business.
In summary, Tata Motors is a leading Indian automaker with a strong brand, diverse product portfolio, and global presence. Its
acquisition of Jaguar Land Rover has boosted its capabilities. However, it faces challenges from heavy domestic market
reliance, intense competition, and industry disruption. Opportunities lie in electric vehicles, international expansion, and
transportation services.
INDUSTRY OVERVIEW

Tata Motors' revenue mix can be broken down into the following segments:
Jaguar Land Rover (JLR): This segment accounts for a significant portion of Tata Motors' revenue,
contributing around 69.1% in FY2024. JLR is a British luxury automotive brand owned by Tata Motors
and has been experiencing strong growth in recent years.
Tata Commercial Vehicles: This segment includes trucks, buses, and defense vehicles and contributes
around 18% of Tata Motors' revenue in FY2024. The commercial vehicle industry in India has been
showing healthy demand, driven by strong economic activity and government infrastructure
development.
Tata Passenger Vehicles: This segment includes passenger cars and SUVs and contributes around
12% of Tata Motors' revenue in FY2024. Tata Motors has been actively investing in expanding its
passenger vehicle lineup, including electric vehicles.
Vehicle Financing: This segment contributes a small portion of Tata Motors' revenue, around 0.8% in
FY2024.
Tata Motors has been focusing on improving its product mix, driving customer preference through
superior product innovation, and exploring new business models like smart mobility solutions and
digital offerings. The company aims to sustain its growth momentum and deliver double-digit EBITDA
margins
 GROWTH OPPORTINITIES
1. Electric Vehicles (EVs)
• Expansion of EV Portfolio: Tata Motors is already a leader in the Indian EV market with models like the Nexon EV. Expanding its EV portfolio to include more
models across different segments could enhance its market share.
• Battery Technology: Investing in advanced battery technology and infrastructure, including partnerships for battery manufacturing and charging networks, can
support long-term growth in the EV sector.
• Government Incentives: Leveraging government incentives and subsidies for EV production and adoption can further drive growth.

2. Global Market Expansion

• Emerging Markets: Entering and expanding in emerging markets where automotive penetration is still growing can provide significant opportunities. Markets in
Southeast Asia, Africa, and Latin America hold potential for Tata Motors.
• Partnerships and Joint Ventures: Forming strategic alliances with local players in international markets can facilitate easier market entry and expansion.

3. Commercial Vehicles
• Innovative Solutions: Developing innovative commercial vehicle solutions, such as electric and autonomous trucks and buses, can cater to the growing demand for
sustainable transportation in the logistics and public transportation sectors.
• Infrastructure Projects: Capitalizing on infrastructure development projects globally, which increase the demand for commercial vehicles, can drive sales growth.

4. Digital Transformation and Connected Vehicles

• Connected Car Technology: Enhancing connected car features, including advanced infotainment systems, telematics, and vehicle-to-everything (V2X)
communication, can attract tech-savvy consumers.
• Data Analytics: Utilizing big data and analytics to improve product offerings, enhance customer experience, and streamline operations.

5. Sustainability Initiatives
• Sustainable Manufacturing: Implementing sustainable manufacturing practices and reducing the carbon footprint in production processes can attract
environmentally conscious consumers and comply with global regulations.
• Recycling and Circular Economy: Engaging in recycling and promoting a circular economy approach can reduce waste and create new business opportunities in
 ECONOMIC FACTORS
Direct Impact of Inflation
• Cost of Raw Materials and Production
• Rising Costs: Inflation generally leads to an increase in the prices of raw materials such as steel, aluminum, rubber, and plastics. As these are key
inputs in automobile manufacturing, the overall cost of production for Tata Motors can rise.

• Supply Chain Disruptions: Inflation can also cause disruptions in the supply chain, leading to higher logistics and transportation costs, which
further increase the cost of production.
• Wage Pressures
Labor Costs: Inflation often leads to increased wage demands from employees as the cost of living rises. This can lead to higher labor costs for Tata
Motors, impacting its operating expenses.
• Interest Rates
Financing Costs: Central banks typically raise interest rates to combat inflation. Higher interest rates increase the cost of borrowing for Tata Motors,
affecting its capital expenditure plans and increasing the cost of financing for consumers, potentially reducing vehicle sales.
Indirect Impact of Inflation
• Consumer Purchasing Power
• Reduced Disposable Income: As inflation erodes consumer purchasing power, individuals may delay or forego large purchases, such as new
vehicles. This can lead to a decline in demand for Tata Motors' products.
• Shift in Demand: Consumers might opt for cheaper or more fuel-efficient vehicles to cope with higher living costs, impacting the sales mix and
profitability for Tata Motors.
• Input Prices and Profit Margins
• Price Increases: To maintain profit margins, Tata Motors may need to increase the prices of its vehicles. However, significant price hikes can
reduce demand and make the company less competitive, especially in price-sensitive markets.
• Cost Management: Effective cost management strategies, such as improving operational efficiencies and negotiating better terms with suppliers,
become crucial in an inflationary environment.
 STRATEGIC RESPONSES TO INFLATION
1. Productivity Enhancements
• Automation and Technology: Investing in automation and advanced manufacturing technologies can help reduce labor costs and
improve efficiency, mitigating the impact of rising production costs.

• Lean Manufacturing: Implementing lean manufacturing techniques can optimize production processes, reduce waste, and lower
costs.
2. Pricing Strategies
• Flexible Pricing: Adopting flexible pricing strategies, including dynamic pricing models and value-based pricing, can help Tata
Motors adjust to changing cost structures without significantly affecting demand.

• Cost-Pass-Through: Gradually passing on increased costs to consumers can help maintain margins while avoiding sudden price
shocks.
3. Product Portfolio Adjustments
• Focus on High-Margin Products: Emphasizing the production and sale of high-margin vehicles, such as luxury cars and SUVs, can
help offset the impact of inflation on lower-margin segments.

• Electric Vehicles (EVs): Accelerating the transition to electric vehicles, which may have different cost structures and are often
supported by government incentives, can provide a buffer against traditional fuel price inflation.
4. Financial Hedging
• Hedging Strategies: Utilizing financial instruments to hedge against inflationary pressures on raw materials and currencies can protect
profit margins.

• Diversified Financing: Accessing diversified and lower-cost financing options can mitigate the impact of rising interest rates.
5. Customer Financing and Incentives
• Attractive Financing Options: Offering attractive financing options, such as low-interest loans or flexible payment plans, can help
sustain vehicle sales even when consumer disposable income is under pressure.

• Incentives and Promotions: Implementing targeted promotions and incentives can stimulate demand and offset the negative impact of
 MAJOR CLIENTS
Tata Motors, a leading global automobile manufacturer from India, has a diverse range of clients across different sectors. Here are some of their
major clients and areas of collaboration:
1. Government and Public Sector:
• Indian Defense Forces: Tata Motors supplies a variety of vehicles, including military trucks and specialized defense vehicles, to the
Indian Armed Forces.
• Public Transport Authorities: Various state transport undertakings in India, such as BEST in Mumbai, DTC in Delhi, and BMTC in
Bangalore, use Tata buses for public transportation.
2. Corporate Clients:
• Logistics Companies: Companies like DHL, Blue Dart, and Gati use Tata Motors' commercial vehicles for their logistics and
transportation needs.
• Construction Companies: Major construction firms, including L&T and Shapoorji Pallonji, use Tata Motors' heavy trucks and tippers.
3. Agriculture Sector:
• Agricultural Enterprises: Companies engaged in agricultural production and distribution often utilize Tata Motors' pick-up trucks and
small commercial vehicles for transportation of goods.
4. International Clients:
• South Asia, Africa, and Latin America: Tata Motors exports its vehicles to several countries in these regions, serving clients across
various sectors, including transportation, logistics, and public services.
• European Markets: Through its subsidiary, Jaguar Land Rover (JLR), Tata Motors serves premium automotive clients in Europe and
other regions.
5. Retail and Consumer Goods:
• E-commerce Companies: Businesses like Amazon and Flipkart use Tata Motors' commercial vehicles for their last-mile delivery
services.
6. Small and Medium Enterprises (SMEs):
• SMEs across different industries utilize Tata Motors' commercial vehicles for their day-to-day operations, including transportation of
goods, raw materials, and finished products.
Tata Motors' diverse product portfolio, ranging from passenger cars and SUVs to heavy trucks and buses, allows it to cater to a wide range of
clients across different industries and geographies.
FINANCIALS
CASH FLOW STATEMENT

3 year consolidated cash flow

KEY RATIOS
 ANALYSIS
• Price to earing ratio: 10.9 indicates that the stock's market price is 10.9 times higher than the company's earnings per share. This
means investors are willing to pay less for each rupee of the company's earnings, potentially indicating a buying opportunity.
• ROCE:A ROCE of 20.1% suggests the company is efficiently generating returns on the capital it employs. This capital could be in
the form of property, plant and equipment, inventory, or even intangible assets. The company is likely making good use of its
resources to generate profits. It is strong indicator of company’s profitability and capital efficiency.
• Return on assets: An ROA of 9.26% is generally considered a good indicator of efficient asset utilization and
profitability. Managing asset growth efficiently is crucial. Excessive asset growth without corresponding revenue increases can
reduce ROA.
• Debt to equity: A Debt to Equity ratio of 1.26 indicates a relatively balanced use of debt and equity, but with a slight preference
towards debt. This means the company is using more debt than equity to finance its operations. It also suggests that the company has
a moderate level of financial risk, as it has more debt than equity but not excessively so.
• Return on equity: An ROE of 49.4% is an outstanding indicator of profitability and efficient management. However, investors
should consider the sources of this high ROE, its sustainability, and the associated risks. The ROE is quite high, indicating that the
company is very effective at generating profits from its equity base.
• Dividend yield: A dividend yield of 0.31% is quite low, suggesting that the company returns a very small portion of its earnings to
shareholders in the form of dividends. Investors looking for income through dividends might find this yield less attractive.

• Current ratio: A current ratio of 0.88 indicates that a company's current assets are not enough to cover its current liabilities.
PEER COMPARISON
 CONCLUSION
• Company has reduced debt.
• Company has delivered good profit growth of 93.1% CAGR over last 5 years.
• Company has a good P/E ratio which makes the more stable in its earnings and utilising its resources efficiently.
I would suggest to buy TATA MOTORS and hold it for long term.