1:1 Split Effect: Tata Motors PV Stock Is Rs 19 Away From 1-Yr Low; Rating Cut, Buy After Tata Sierra?

Tata Motors Passenger Vehicles' (TMPV) share price has corrected significantly after the listing of the Tata Group's only commercial vehicle company, TMCV. Tata Motors has split into two separate entities, namely PV and CV businesses. However, TMPV share price witnessed deep selling pressure this week, with brokerages reducing their ratings on the stock. TMPV is also in focus for the much-awaited launch of the new generation Tata Sierra in India. Should you buy TMPV stock, and what will be the new target price?

Tata Motors Passenger Vehicles Share Price:

At the time of writing, TMPV share price traded at Rs 353.80 apiece, down by 1.24% on BSE with a market cap of Rs 1,30,280.88 crore. The stock is near its intraday high of Rs 353.55 apiece. With that the stock is nearly Rs 19 away from hitting its 1-year low of Rs 335.30 apiece. While the stock has already nosedived by 30.9% from its 1-year high of Rs 507.97 apiece.

Tata Sierra Launch:

On November 25, TMPV launched the new-generation SUV, Tata Sierra, at a starting price of Rs 11.49 lakh in the ex-showroom, Delhi. The new Sierra version is equipped with a new 1.5-litre GDi turbo petrol engine producing 158bhp and 255Nm. Also, car lovers can buy Sierra with a 1.5-litre NA petrol that has capability to produce 105bhp and 145Nm along with an option between six-speed MT or a seven-speed DCT.

The car is available in six colour schemes, four variants and three powertrain options. The booking window for the new Sierra will open from December 16, while deliveries are expected to begin from January 15, 2026.

Why Brokerages Are Cutting Tata Motors Passenger Vehicles Share Price Rating?

Analysts at JM Financial has reduced rating to 'REDUCE' on TMPV owing to challenges that persist even after 1:1 demerger.

According to the analysts, in 2QFY26, JLR EBIT margin came in at -8.6% (-1,370 bps YoY, -1,260 bps QoQ), impacted by production loss due to cyberattack, tariff-related expenses (£74 million), unfavourable forex (£237 million), and higher warranty costs. Management highlighted that geopolitical tensions, tariff uncertainty, and supply chain risks persist. Reflecting these challenges and the cyberattack impact, JLR lowered its FY26 guidance, now expecting EBIT in the range of 0%-2% (earlier 5%-7%) and negative free cash flow of £2.2-£2.5 bn (earlier near zero).

However, the outlook for domestic business in 2HFY26 remains strong with double-digit industry growth expected and overall FY26 growth likely in the 5% range.

But JM's analysts take note that ICE profitability is expected to remain muted in 3Q but should improve in 4Q with the Sierra launch, price increases, better mix, and cost-reduction initiatives. Hence, they said, "We initiate coverage with REDUCE rating and a SOTP-based (JLR at 7.5x EV/EBIT and standalone at 10x EV/EBITDA) TP of INR365."

Further, analysts at Emkay Global also reduced their rating on TMPV to ADD from earlier BUY call.

"We downgrade TMPV to ADD (from Buy), with an SOTP-based TP of Rs400. TMPV logged a weak Q2, with consolidated revenue down 14% YoY and a negative EBITDAM (-1.9% vs 11.9% YoY) on a sharp drop in JLR (cyberattack wiped out production of 20k units in Q2), leading to a 24% YoY revenue drop and EBITDAM of -1.6%," analysts at Emkay said.

Just like JM, analysts at Emkay also believe that India PVs continue to build momentum with a favorable product cycle, reflected in record festive retails, a richer ~45% EV+CNG mix, rising EV profitability aided by the Rs32.5bn PLI, strong demand for Harrier.EV (16-18 weeks waiting), and upcoming Sierra/Sierra EV and Harrier-Safari ICE launches that are expected to aid mix/margin recovery from Q4.

However, given JLR's dominant contribution (~80% of Q2 topline) and the materially weaker demand, margin, and FCF outlook for FY26-27, Emkay turned cautious despite the constructive India PV setup.

Among the global brokerages, HSBC also lowered its target price to Rs 400 from earlier Rs 466, while maintaining its HOLD rating, citing similar challenges in JLR.

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