Rakesh Jhunjhunwala portfolio: Motilal Oswal bullish on this multibagger stock; here's why

Brokerage house Motilal Oswal has maintained its bullish stance on Tata Motors Limited (TTML), a part of Big Bull's portfolio. It believes that TTML's all three businesses are in recovery mode.
 
"While the India commercial vehicle (CV) business would see cyclical recovery, the domestic passenger vehicle (PV) business is on a structural recovery mode. JLR is also witnessing a cyclical recovery underpinned by favorable product mix; however, supply-side headwinds will defer the recovery process," Motilal Oswal said in its recent report.
 
The stock opened 0.83 per cent higher at Rs 514.10 against the previous close of Rs 509.75. With a market capitalisation of more than Rs 1,74,000 crore, the shares stand higher than 5 day, 20 day, 50 day, 100 day and 200 day moving averages.
 
In the past one year, the share price of Tata Motors jumped from Rs 245.65 to Rs 526.90 mark ---- logging around 114 per cent return in this period.
 
"While there would be no near-term catalysts from the JLR business, the India business (~50 per cent of SOTP) would see sustained revival. The stock trades at 20.1x FY24E consolidated EPS and 3.1x P/B. We maintain a 'BUY' with a Mar’24 SOTP-based target price of Rs 610," the brokerage house said.
 
It noted that Jaguar Land Rover (JLR)’s 3QFY22 wholesale volumes (excluding CJLR JV) declined 33 per cent YoY (+9 per cent QoQ) to 69.2k units (v/s estimated 80k units) and the production increased 41 per cent QoQ to 72.2k units in 3QFY22, reflecting improvement in chip supply.
 
It added that the wholesale volumes of Range Rover, Range Rover Sport, and I-Pace grew 92, 64, and 34.5 per cent QoQ, respectively, reflecting mix improvement.
 
As per the shareholding pattern, Jhunjhunwala owns 1.11 per cent stake as of September 2021. Speaking exclusively with Business Today TV's Udayan Mukherjee, the Indian ace investor had said that Tata Motors' foray into the electric vehicles segment will boost the stock going ahead.
 
Homegrown auto major Tata Motors reported a 2 per cent year-on-year (YoY) rise at 2,85,445 units in group global wholesales, including Jaguar Land Rover, for the quarter ending December 31 , 2021. 
 
For all passenger vehicles, the global wholesales in Q3FY22 stood at 1,82,673 units, down 3 per cent as compared to the same period a year ago.
 
The Tata Group firm reported a widening of consolidated net loss to Rs 4,415.54 crore in Q2 due to higher expenses and lower sales of British arm JLR following the shortage of semiconductors.
 
The company reported a consolidated net loss of Rs 307.26 crore in the corresponding period of last fiscal. Revenue from operations stood at Rs 61,378.82 crore against Rs 53,530 crore in the year-ago quarter.