InvestorQ : After the results in the June quarter, I am wondering if it is worthwhile to hold on to Tata Motors or exit from the counter. What should I do?
indhumathi Sayani made post

After the results in the June quarter, I am wondering if it is worthwhile to hold on to Tata Motors or exit from the counter. What should I do?

Answer
user profile image
shrinidhi Rajan answered.
1 year ago


You can quickly run through the June quarter results to zero in on whether to hold on to the stock or not. Consider the numbers. For the quarter ended Jun 2019, Tata Motors reported a huge loss of Rs.3689 crore, largely due to pressure from the largest component of its business viz. Jaguar Land Rover. This is almost the twice the loss reported in the June quarter last year. Total revenues were down by 30% at Rs.60,830 crore. The overall loss was largely driven by a net loss of £401 million in its JLR business. JLR numbers have been hit by weak China demand and also by worries in the EU area due to the likely impact of BREXIT.

JLR had reported a fall of 11% in overall sales and Tata Motors has also been struggling in the Indian markets, where it had to take sharp cuts. As of now the problem for Tata Motors is that there is no hope unless JLR picks and that is in an uncertain environment. The company is also planning a major shift into EV (electrical vehicles) but that could have more of a long term impact. As of now it is best to avoid the stock.