Tata Motors shares jump 5% on strong growth guidance. Nomura, what are other brokerages saying?

Shares of Tata Motors (Commercial Vehicles) on Wednesday hit their intra-day high of Rs. 420 was up 5%, with double-digit EBITDA margins, free cash flow of 7-9% of revenue, and 28-28% of revenue invested annually as expenses. Pursues global expansion, electrification and high-margin digital businesses.

At its Investor Day 2026, the company said it has achieved many of its FY2027 targets ahead of schedule, including improving margins, cash generation and strengthening its leadership position in heavy commercial vehicles.

Here’s what the brokerage says:

JM Financial: Buy call and Rs. With a target price of 475, the brokerage suggests upside of 19% from current levels. Analysts said Tata Motors’ management remains optimistic on the long-term outlook for the commercial vehicle business, supported by healthy GDP growth, sustained infrastructure spending and rising e-commerce penetration.

The brokerage also noted that GST-driven freight efficiency is supporting demand for multi-axle trucks. While elevated diesel prices, commodity inflation, geopolitical uncertainties and the possibility of interest rate hikes remain near-term challenges, management believes these headwinds are manageable and do not materially alter the sector’s long-term growth prospects.

Also read: Tata Motors CV is betting on global expansion, EVs and digital businesses for the next phase of growth

Nomura: Foreign brokerage on Tata Motors Rs. Maintained its neutral rating with a target price of 400. It said demand for medium and heavy commercial vehicles improved in June as concerns over the recent war eased.

Following the plant visit, Nomura highlighted several initiatives undertaken by the company to enhance products and services through technology and digital integration. According to the brokerage, these efforts should strengthen Tata Motors’ long-term competitiveness and improve consumer economics.

However, Nomura remains cautious on Iveco, citing weak performance over the past six months. It said it is awaiting further clarity on the integration process and realization of synergies before becoming more constructive on the stock.

As for its forecasts, Nomura expects MHCV volumes to grow by 5% each in FY27 and FY28, while EBITDA margins are estimated at 12.6% and 13.3%, respectively. The brokerage noted that if Tata Motors gains market share, the volume may see an increase. It also expects Iveco’s EBIT margin to improve to 2.4% in FY27 and 5.5% in FY28.

Motilal Oswal: The brokerage has a neutral rating and Rs. 416 is the target, indicating 4% upside. It has become cautious on the near-term outlook for Tata Motors’ commercial vehicle business, citing recent geopolitical tensions and their potential impact on the Indian economy. It also expects margins to remain under pressure in the near term.

Read more: Tata Motors PV by FY31 Rs. 6 lakh crores in revenue

Motilal Oswal now expects Tata Motors’ commercial vehicle volumes to grow at a CAGR of 6% in FY26-28. Based on that, it projects revenue, EBITDA and profit after tax to grow at a CAGR of 8%, 8% and 10% respectively during the same period.

The brokerage said the stock is valued at 21.7 times FY27 estimated earnings and 18.6 times FY28 estimated earnings. Valuation for Tata Motors stake in Tata Capital at Rs. 12 per share based on an estimated FY28 EV/EBITDA of 12 times, for the core business, with an incremental value of 12 per share.