3 Tata Group Stocks To Watch This Week With BUY Rating For Target Price Ranging From Rs 831 To Rs 1,840

The Nifty and Sensex stayed range-bound throughout last week, closing with losses at 22,397.2 and 73,828.91, respectively, which caused markets to settle slightly down. On the sectoral front, the majority of indices saw a decline, with the largest losses being IT, auto, and real estate. In addition to ongoing selling by foreign institutional investors, which recorded net outflows of Rs 5,729 crore in the cash segment while DIIs infused totalled Rs 5,499 crore, sentiment among traders continued to be vigilant due to growing concerns over the possibility of global trade war, which were fuelled by brings up on US tariff plans. Future developments include the US Federal Reserve's monetary policy review on March 19 and FII activity, amid which top brokerages have been enchanted with three Tata Group stocks.

Tata Consumer Products

Target: Rs. 1,067, CMP: Rs 945

"TCPL delivered strong financial performance in Q3FY25, driven by robust growth in the India business, particularly in food and beverages. The company's diversified portfolio, including leading brands such as Tata Tea, Tetley and Tata Salt, positions it well for long-term growth. Additionally, the company's focus on innovation, premiumisation and expansion into new channels, such as food services and pharma, is expected to drive growth. The company's ability to leverage the Tata brand in consumer products, combined with its strategic acquisitions, further strengthens its position in the consumer market. Therefore, we upgrade our rating to BUY from HOLD on the stock, with a rolled forward target price of Rs. 1,067, based on 49x FY27E adjusted earnings per share," said Geojit Financial Services Ltd dated 11th March.

Tata Communications

Target: Rs 1,840, CMP: Rs 1,508.95

"We upgrade Tata Communications' (TCom) two notches to BUY (from Hold). TCom's stock price has plunged notably beset by near-term revenue weakness - making the company's revenue guidance seem rather ambitious. In our view, this presents strong upside potential and compelling risk-reward. In FY24, TCom was wosrn by a cable cut in the Red Sea and weak order book (OB) growth. With the Red-sea issue now behind and double-digit FY25-TD OB growth, TCom's data revenue growth will likely swell. We believe TCom's strong digital product portfolio aside, Street is yet to bake in INR 33bn of FY27E FCF generation (EBITDA minus capex) in core connectivity (7.2% of EV). Notably, TCom has launched many products serving cloud ecosystem - shall benefit from its adoption. Also, TCom has been agile in embedding AI in internal process/services - these upfronted investments/potential are undervalued," stated ICICI Securities on 11th March.

"We arrive at an SoTP-based TP of INR 1,840; our estimates remain unchanged. We assign 11x FY27E EV/EBITDA to its core business (implies 7x EV/EBITDA for core connectivity and 2x sales for digital services). At CMP, we believe, TCom deserves a double upgrade to BUY due to: 1) strong pile-up of sales funnel; and early signs of OB growth; 2) strong digital services portfolio with focus on serving cloud ecosystem; and adoption of AI within the organisation; 3) upside risk to connectivity demand from rising adoption of AI; 4) financial discipline and sharp focus on capital allocation without compromising on growth investments; and 5) compelling valuations - stock trades at FY27E FCF yield of 4.5%; and FY27E EV/ EBITDA of 7.9x," the brokerage firm further added.

Tata Motors

Target Price: Rs 831, CMP: Rs 654.70

"We attended Tata Motors' (TTMT) analyst meet. For its JLR business, the US continues to do well alongside recovery green shoots in the EU market. TTMT maintained its EBIT margin guidance of 10% for Q4FY25. In its India PV business, the company has planned multiple launches across powertrains, including Sierra and Harrier, and a repositioning of Curvv and Altroz. In its India CV business, TTMT is focusing on overhauling its SCV business by tending to key issues. With its recent stock price correction, we upgrade TTMT to BUY (from Add) with a SoTP-based unchanged TP of INR 831, implying 11x/2.4x FY27E India/JLR EV/EBITDA," ICICI Securities confirmed on 12 March.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.