While it has a “buy” recommendation on Tata Motors CV, with an upside projection of 16% from current levels, it has an “underperform” rating on the Passenger Vehicles business, with a downside potential of close to 15%.
BofA Bets On Tata Motors CV
The brokerage’s “buy” recommendation comes with a price target of ₹470.
The brokerage said the commercial vehicle cycle debate continues but the market share trends are getting better for the company. Tata Motors CV is gaining share in heavy commercial vehicles and small commercial vehicles on its platform refresh aided by new launches.
Tata Motor CV’s margin focus over chasing growth is intact, despite near term cost pressure. Pricing discipline, mix, cost control and truck revenues are some of the other areas of focus.
The brokerage added that the upside of the Iveco acquisition hinges on the EU light commercial vehicle recovery, sourcing / capex synergies and balance sheet deleveraging. Based on all of this, BofA Securities said that the risk-reward for Tata Motors CV is favourable considering the adjusted Enterprise Value to EBITDA multiple of 10 times.
On another note, Tata Motors’ commercial vehicle business reported a 17% increase in sales in May 2026 even though it was below Street estimates.
The total CV sales stood at 32,850 units in May compared to 28,147 units in the year-ago period. However, it was below Street estimates of 34,900 units.
Of the 26 analysts who have coverage on Tata Motors CV, 23 have a “buy” rating and three have a “hold” rating.
Why is BofA Bearish On Tata Motors PV
BofA Securities’ “underperform” rating on the Passenger Vehicle business comes with a price target of ₹335.
The brokerage said that the investor queries ahead of the JLR analyst day focused on margin roadmap for the company, given the structural drag from China, tariffs, warranty issues and other factors.
Tata Motors PV’s margin recovery hinges on a self-help program, targeting lower break-even points and cost savings of close to £1.7 billion, BofA wrote, adding that specifics will have to be watched, especially considering the recent updates from the EU OEMs have not been very encouraging.
Execution on JLR’s new launches, its Electric Vehicle strategy, and cost-cut programs will be key for the company amidst tough macros, BofA said.
Shares of Tata Motors Passenger Vehicles are trading 2.7% lower on Wednesday at ₹383, while those of the Commercial Vehicles division are down 0.8% at ₹403.35.
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