Tata Motors share price is
sitting at its historical high and thanks to very robust sales of its Jaguar and Land Rover sales across different geographies. The robust growth prompted
all analyst to recommend buying opportunity to make good return in short to
medium term. This also prompted active F&O market which led the share price
to shoot around 15% in the last 30 days. For a large cap like Tata motors
share, such a steep rise in share price is worrisome. The reason is Mr. Mistry
humble acceptance that FY17 will be challenging year for Tata Motors. He also
confirmed loud and clear that China economy will be going downwards in coming
month. He also pointed out that UK exit from EU will add more pain to Tata
Motors given its headquarter is based out of UK.
On top of that during 71st AGM ofTata Motors, Investors clearly showed their displeasure about company offered
dividend payout of INR .20 ($0.003). It is interesting to know that the market
cap of Tata Motors is currently running at $30 Bn and domestic business is
struggling given the non acceptance of some of the recent launches by Tata
Motors.
It is advisable for the investor
to book profit and sit on the sideline with cash. It is expected that Tata
Motors share will correct in recent weeks and will come down to a level of 400
level. The committed capex by the Tata Motors towards the product development
to new factories for Jaguar & Land Rover runs in Billions of $'s. The
clever Investor should use this as an opportunity to sell at higher level an
enter into lower level
Disclaimer - Consult your
Financial advisor before investing
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