Posted on May 9, 2025, by Niftynews
Tata Motors share price surged 3.5% on May 9, 2025, marking its third consecutive day of gains. The auto giant’s shares hit an intraday high of ₹704 on the BSE, fueled by positive sentiment around the India-UK Free Trade Agreement and stronger-than-expected Jaguar Land Rover (JLR) Q4 sales. The company’s demerger plan also added fuel to investor optimism.
The recent rally comes at a crucial time, as the stock had underperformed in previous months. With momentum building and analysts turning bullish, many are now asking: Is Tata Motors share price set for a breakout?
🇬🇧 India-UK Trade Deal: A Tailwind for Tata Motors Share Price
The recently announced India-UK Free Trade Agreement (FTA) has turned into a major catalyst for Tata Motors. The deal proposes to reduce import tariffs on foreign-manufactured vehicles from 100% to just 10% under a quota-based system. This development is particularly significant for JLR, Tata Motors’ luxury arm.
📦 Why It Matters for JLR:
- Reduced tariffs could lead to a surge in UK-made vehicle exports to India.
- Improved competitiveness against other global luxury auto brands.
- Greater pricing power and higher margins in one of the world’s fastest-growing premium car markets.
This potential tariff cut could significantly enhance JLR’s volumes and profitability, providing a much-needed shot in the arm for the segment—and lifting Tata Motors share price in the process.
📈 Strong Q4 Sales Support Tata Motors Share Price Rally
Even before the FTA news broke, Tata Motors had delivered solid results in its luxury division. JLR’s Q4FY25 sales rose 6.7% quarter-over-quarter and 1.1% year-over-year, despite lingering supply chain issues and a slowdown in China.
This performance reinforced confidence in JLR’s turnaround strategy, particularly as electrification and tech integration gather pace in European and U.S. markets. Analysts see these results as confirmation that Tata Motors is moving in the right direction.
🔄 Strategic Demerger Could Unlock Further Value
Tata Motors also announced plans to split its business into two publicly listed entities:
- Commercial Vehicles (CV)
- Passenger Vehicles (PV), Electric Vehicles (EV), and Jaguar Land Rover (JLR)
🎯 Goals of the Demerger:
- Improve operational focus
- Increase agility in decision-making
- Enable better capital allocation
- Create long-term shareholder value
This strategy has been met with widespread support, as it allows each division to operate with autonomy while aligning with market-specific growth trends. Analysts believe the move could lead to re-rating of Tata Motors share price, especially for the high-growth EV and luxury segments.
📊 Technical View: Is Tata Motors Share Price Breaking Out?
Rajesh Bhosale, Equity Technical Analyst at Angel One, highlighted that Tata Motors share price has found strong support around the 200-week Simple Moving Average (SMA), indicating a potential reversal after a period of underperformance.
“We’re seeing early signs of a bullish breakout. ₹600 appears to be a strong support zone, and the next resistance lies near ₹820,” said Bhosale.
Anshul Jain, Head of Research at Lakshmishree Investments, added that the stock is bouncing off a confluence of support zones—including the 10, 20, and 50-day exponential moving averages. He noted a bullish open-low formation, suggesting strong buying interest at lower levels.
Jain further explained:
“The short-term target is ₹723.05. A decisive breakout above that could see Tata Motors testing ₹856, which is the 50% Fibonacci retracement level of the prior correction.”
🔍 Should You Invest in Tata Motors Now?
Here’s a breakdown of the bullish case for Tata Motors:
✅ Reasons to Consider Buying:
- Major tailwind from the India-UK FTA
- Strong Q4 sales in JLR despite macro challenges
- Strategic demerger unlocking operational value
- Technical indicators pointing toward a reversal
- Renewed institutional interest in auto and EV plays
⚠️ Risks to Watch:
- Global economic uncertainty and geopolitical tensions (e.g., India-Pakistan)
- Dependency on international markets, especially China
- Execution risks related to the demerger
🧠 Analyst Verdict on Tata Motors Share Price Outlook
Most analysts remain bullish on Tata Motors in the medium to long term. The combination of structural tailwinds, policy support, internal restructuring, and improved financial performance has significantly strengthened the company’s investment case.
Brokerages like Nomura, Axis Capital, and ICICI Securities have maintained Buy ratings, with target prices ranging from ₹780 to ₹880.
📌 Final Word: What’s Ahead for Tata Motors Share Price?
With momentum from trade deals, Q4 sales, and strategic clarity, the Tata Motors share price appears well-positioned for continued upside. The demerger, in particular, could act as a major long-term catalyst.
For long-term investors seeking exposure to India’s EV and global auto growth story, Tata Motors presents a compelling opportunity—especially at current levels, before a confirmed breakout.
