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Economic Times
32 minutes ago
- Automotive
- Economic Times
Tata Motors shares down 42% from peak: Should you buy the dip in this auto major's stock?
Once a bellwether of India's auto rally, Tata Motors now finds itself trading at a steep 42% discount to its record high. After a bruising year of tariff shocks, margin pressures, and waning momentum, the stock is testing investor patience, and tempting bargain hunters. Is this slump a value trap or a rare buying opportunity in one of India's most storied automakers? ADVERTISEMENT From a technical standpoint, Tata Motors shares are trading at Rs 682.30, below seven of their eight key simple moving averages (SMA), with the exception of the 100-day SMA. The Relative Strength Index (RSI) is hovering at 49.9, signalling a lack of directional conviction, while the MACD remains below the centre line at -1.0. Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities, noted that 'the stock has been moving in a 665–710 range since 16th June. Although the Auto index is outperforming the Nifty index, this stock has been a laggard.' He said, 'The RSI has been moving in the 40–60 range, supporting the sideways movement with the stock clearly lacking momentum. The ADX line is flat which further reinforces the lack of momentum in the stock.' Shah said that 'a decisive breakout on either side of the range can provide cues about the future direction of the stock.' He pointed to Rs 665 as a key support level and Rs 710 as immediate resistance. 'Break below 665, can lead to price moving towards 635, where its prior swing low is placed… Break above 710, can lead to price moving towards 735–740 zones, where its 200 DEMA is placed currently. Momentum is unlikely unless 735–740 is successfully taken out on the upside.'Adding to the technical picture, Kunal Kamble, Senior Technical Research Analyst at Bonanza, observed that 'since June 18, 2025, Tata Motors has been trading within a well-defined range of Rs 665–Rs 700, suggesting a consolidation phase after a prior uptrend.' He said, 'The 9 & 21 EMAs are flattening, reflecting the absence of a strong directional trend. The RSI trading below 50 suggests a lack of momentum… The DMI (Directional Movement Index) remains compressed, indicating low trend strength.'Kamble said 'a decisive breakout above Rs 700 could trigger a move toward Rs 740, while a breakdown below Rs 665 may lead the stock to retest support at Rs 635.' But for now, 'it's prudent to remain on the sidelines and wait for volume-supported confirmation of a breakout or breakdown.' ADVERTISEMENT Anuj Gupta, Director at Ya Wealth, said, 'Broadly the trend of Tata Motors is sideways as it is trading between the support of 600 levels and resistance of 750 levels.'Gupta said, 'For a very short term it has support at 670 levels and next support at 640 levels. Resistance at 710 and strong resistance at 750 levels.' He expects 'short term trend reversal in this stock,' and said, 'Investors may start investments in the Tata Motors around 640 to 670 range. We are expecting it may test 720 to 750 levels in the next 3 to 4 months. Keep support levels as stoploss levels.' ADVERTISEMENT Tata Motors shares rose 2% on Monday following an announcement that the U.S. and European Union had reached a deal to avert a major tariff escalation on EU exports, reducing car tariffs to 15% from a potential 30% hike. The new agreement replaces a 25% duty on EU auto exports with a baseline 15% rate, aligning it with the rate set for Japan. ADVERTISEMENT Anubhav Sangal, Senior Research Analyst at Bonanza, said the U.S-EU tariff agreement is 'expected to support volume growth for European automobile exporters, particularly Jaguar Land Rover (JLR), the luxury vehicle arm of Tata Motors.' He said that 'with the new deal reducing tariffs on vehicle exports from Slovakia to the United States from 27.5% to 15%, key models such as the Defender which is manufactured in Slovakia will now enjoy improved cost competitiveness in a critical market.'JLR had paused U.S.-bound shipments from its Slovakian plant in April due to higher tariffs, but resumed them in May. The North American market accounts for approximately 32% of JLR's total Sangal also flagged concerns. 'JLR trimmed its FY26 margin guidance to 5–7% (from earlier 10% guidance), primarily due to uncertainties over US tariffs.' He said, 'The company is currently facing several headwinds, like rising emission compliance and warranty costs in FY25, along with currency headwinds from USD depreciation against GBP.' ADVERTISEMENT At a group level, Tata Motors reported a 51% fall in consolidated net profit at Rs 8,470 crore in Q4 FY25, while revenue remained flat at Rs 1.19 lakh crore. EBITDA fell 4% to Rs 16,700 crore, with EBITDA margins slipping 60 basis points to 14%. For the same period, JLR posted £875 million in profit before tax, up from £661 million in Q4 FY24, aided by higher volumes and lower depreciation and Monday's bounce, analysts remain cautious in the near term. Kamble said, 'At this stage, it would be premature to call a trend reversal in Tata Motors, as the stock appears to be in the midst of a corrective wave.' He warned that 'the trend would only shift decisively if the stock manages to close above the swing high of Rs 745… Until that happens, bearish pressure remains intact.'Shah of SBI Securities echoed the sentiment, and said, 'Currently there are no trend reversal signs visible. The stock is moving in a tight range, forming thin body candles along the way. The momentum indicators and oscillators are further reinforcing the sideways movement in the stock.'Even as the stock remains vulnerable to further volatility, Anuj Gupta sees some cause for optimism. 'Now in India good monsoon may support the auto stock where Tata Motors may get good response due to availability in EVs segment. Upcoming festival season will also support the stock's price.'For now, Tata Motors remains range-bound and directionless, with near-term triggers hinging on sustained improvements in JLR's outlook and a breakout above key technical levels. Also read | Reliance Power shares down 15% in a month as ED probe drags. Can the stock reclaim Rs 70 amid volatility? (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times) (You can now subscribe to our ETMarkets WhatsApp channel)
Time of India
14 hours ago
- Business
- Time of India
Market breadth narrows: 60% of NSE 500 stocks still 20% below 2024 highs; analysts flag overvaluation, weak earnings outlook
While benchmark indices like the Nifty 50 and Nifty 500 have rebounded and now sit 5–6% below their September 2024 record highs, a majority of the broader market continues to lag, with over 60% of NSE 500 stocks still trading more than 20% below their 2024 peaks, according to an ETIG study. The surge earlier in 2024 had lifted many stocks to lifetime highs, but since the September reversal of a four-year bull run, the rebound has been uneven. As per the analysis, 118 stocks in the Nifty 500 are 20–30% off their 2024 highs, 83 stocks are 30–40% below their peaks, and another 113 are trading more than 40% lower. In contrast, the Nifty 500 and Nifty 50 indices are 6.1% and 5.3% away from their respective highs. 'This points to a narrow market rally, often driven by specific sectors or large-cap names,' Sudeep Shah, vice president and head of technical and derivative research at SBI Securities, told ET. He noted that the broader mid- and small-cap segments remain sluggish despite the overall index recovery. Some of the worst-hit stocks include Jaiprakash Power Ventures, Network18 Media & Investments, Zee Entertainment Enterprises, Sammaan Capital, and Suzlon Energy, which are all down between 84% and 97% from their all-time highs. Others like Adani Total Gas, MMTC, Yes Bank, HFCL, and Vodafone Idea are also significantly off their peaks. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like No annual fees for life UnionBank Credit Card Apply Now Undo Only four stocks—Laurus Labs, Fortis Healthcare, Shyam Metalics & Energy, and Torrent Pharmaceuticals—are trading above their 2024 highs. Despite these declines, elevated valuations persist in many segments. 'Even a reasonably high growth company cannot be expected to deliver 35–40% growth to justify the valuations,' said Ashwini Shami, EVP and senior portfolio manager at OmniScience Capital. 'The overvaluation is not over in the small and midcap stocks and these stocks are not expected to go back to the previous highs as that momentum was driven primarily by euphoria,' he told ET. Between September 2024 and February 2025, the Nifty 500 declined 18.8%, while the Nifty Mid-cap 150 and Small-cap 250 indices dropped 20.6% and 25%, respectively. Over the past three months, mid-cap and small-cap indices have recovered 9.2% and 12%, respectively, with the Nifty 500 gaining 5.3%. Investors have turned selective amid concerns over corporate profitability and tariff-related uncertainty. 'Money is expected to flow to repriced pockets like the largecaps which are fairly priced, and within sectors, banks, housing finance companies, and financial services companies even in the mid and small-cap basket could offer investors a better bet,' said Shami. He added that infrastructure and power stocks also present opportunities, but investors must be cautious of elevated valuations. Shah pointed out that many midcaps and PSUs have surged more on sentiment, liquidity, and policy optimism than earnings. 'The valuations in some pockets have turned reasonable but are still trading at a premium to their historical averages in others, especially in sectors such as consumer durables, FMCG, and select midcap IT names,' he said. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
18 hours ago
- Business
- Time of India
Stock market at near two-month lows: Why are FIIs selling Indian stocks? Explained
The stock market downturn is being attributed to the persistent FII selloff. (AI image) Indian stock markets are at near two month lows - Nifty50 and BSE Sensex have dropped over 2% in the last few trading sessions. Foreign Institutional Investors (FIIs) are on a selling spree! On Monday, Nifty50 and BSE Sensex declined for the third consecutive day. Equity benchmark indices have been dropping for four straight weeks. The stock market downturn is being attributed to the persistent FII selloff and the rising uncertainty of whether India will be able to seal a trade deal with the US before Donald Trump's August 1 deadline. Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited says, 'FII selling of Rs 13552 crores in the cash market last week has added to the weakness in the market. Yet another concern is the Q1 results, which are not yet indicating any major positive surprises.' Why are FIIs Selling Indian Stocks ? Over the past four months, FIIs remained net buyers in the Indian cash market, investing a total of ₹24,011 crore — averaging over ₹6,000 crore per month. However, this trend has sharply reversed in July, with FIIs pulling out ₹28,528 crore so far till Friday, signaling a significant shift in sentiment. This selling has been far more aggressive than the pockets of mild buying seen on select days, says Sudeep Shah, Head - Technical and Derivatives Research, SBI Securities. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Cote D'ivoire: Unsold Sofas at Bargain Prices (Prices May Surprise You) Sofas | Search Ads Search Now Undo 'Alongside, the FII long-short ratio in index futures has dropped steeply from 36.4 on June 30 to just 14.83 by July 24, driven by a sharp rise in short positions — net contracts worsening from -38,123 to -1.45 lakh,' Sudeep Shah tells TOI. He is of the view that multiple factors seem to be at play. 'The US dollar has strengthened by 0.88% since the start of July, making Indian assets relatively less attractive. Additionally, expectations of a Fed rate cut, lack of any major trade deal announcement involving India, and the impact of the Jane Street ban have also weighed on FII sentiment,' Sudeep Shah says. 'This combination of heavy outflows, rising shorts, and low confidence has contributed to a 3.24% decline in the Nifty from its July highs, reflecting the nervousness in the broader market,' he adds. According to Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, FII activity picked up in July 2025, driven by a mix of global macro developments, short-term policy uncertainty, and cautious positioning. 'One of the main reasons behind this cautiousness is the delay in finalising the India–US trade agreement. Conversations around tariffs and digital trade rules have added some ambiguity, prompting foreign investors to hold back a bit and watch how things unfold. On top of that, Q1 FY26 earnings have been slightly slow in some FII-heavy sectors like IT and financials,' Rajani told TOI. She attributes the FII positions to global factors and headwinds as well. 'The US 10-year Treasury yield has been climbing and the dollar is gaining strength, leading some global investors to rebalance their portfolios with more exposure to the US. In the derivatives segment, we're also seeing over 80% short positions by FIIs in index futures, which looks more like a tactical response to the current uncertainty than a directional call. Whenever FII positioning has reached around 80% on either the long or short side, markets have often seen a reversal in direction,' she said. Indian Stock Markets Resilient Shweta Rajani is confident that India's macro fundamentals continue to offer support. 'GDP growth remains strong at 6.5% for FY25 and is projected at 6.6% for FY26, maintaining India's status as the fastest-growing major economy. Inflation is well under control, with CPI at 2.1% in June and expected to stay below the RBI's 3.7% target,' she explains. 'Fiscal strength is also evident, the FY25 deficit narrowed to 4.8% of GDP, aided by disciplined spending and a record ₹2.7 lakh crore RBI dividend. Tax collections have been robust, growing 13.7% in FY25, reflecting strong economic activity. Also, DII inflows of ₹37,687 crore this month, have helped cushion the impact of foreign outflows and provided a layer of stability,' she adds. 'Overall, these phases are a normal part of market cycles. With strong domestic fundamentals and active DII support, Indian markets remain in a neutral zone where FII selling alone is unlikely to cause a sharp correction. Investors should stay focused on long-term goals and avoid reacting to short-term fluctuations,' she concludes. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
a day ago
- Business
- Time of India
Top stocks to buy this week: What's the outlook for Nifty? Check stock recommendations
Top stocks to buy (AI image) Stock market recommendations: According to Sudeep Shah, Head - Technical Research and Derivatives, SBI Securities, Shyam Metalics and Energy Ltd, and Cipla are the top stock picks for this week. Here's his view on Nifty, Bank Nifty for the week starting July 28, 2025: Nifty View: The benchmark Nifty index has continued its downward trajectory, extending its losing streak for the fourth consecutive week. This persistent weakness can be attributed to a combination of factors — the absence of strong positive triggers, Q1 earnings from key corporates coming below expectations, and lingering uncertainty on the global trade deal front, all of which have dampened investor sentiment. Last week, the index made a feeble attempt to rebound from the crucial support zone; however, the recovery lacked conviction and fizzled out quickly. On Wednesday, Nifty managed to close above its 20-day EMA, briefly reviving hopes of a turnaround. But the optimism was short-lived, as renewed selling pressure dragged the index back into negative territory. The bearish undertone deepened on Friday, when the index decisively broke below two critical technical levels — the 50-day EMA and the 61.8% Fibonacci retracement of its recent upswing from 24473 to 25669. This breakdown not only reflects fading bullish momentum but also signals growing nervousness among market participants. With no clear positive cues on the domestic or global front, the market appears vulnerable to further consolidation or downside in the near term. Talking about crucial levels, the 100-day EMA zone of 24600-24550 will act as immediate support for the index. Any sustainable move below the level of 24550 will lead to further correction up to the 24200 level. While on the upside, the 20-day EMA zone of 25100-25150 will be the crucial hurdle for the index. Bank Nifty View The banking benchmark index, Bank Nifty, has relatively outperformed the broader frontline indices by closing the week on a mildly positive note, even as the overall market sentiment remained weak. Throughout the week, the index attempted to stage a recovery from lower levels, supported by selective buying in heavyweight banking names. However, it once again struggled to surpass the horizontal trendline resistance (57300-57400), which continues to act as a formidable barrier for the bulls. Despite the intraday attempts to break out, the index faced selling pressure near resistance zones and eventually retreated from higher levels. By the end of the week, Bank Nifty settled near the 56500 mark, registering a modest gain of 0.44%. From a technical standpoint, the weekly price action has resulted in the formation of a Gravestone Doji candlestick pattern, which typically signals indecision in the market and a potential reversal when it appears after an up-move. This pattern, coupled with the repeated failure to breach resistance, suggests caution in the near term, with the need for a strong breakout to resume upward momentum. Going ahead, the zone of 57300-57400 is likely to continue to act as a crucial hurdle for the index. While on the downside, the zone Stock Recommendations: Shyam Metalics and Energy Ltd On the weekly chart, the stock has confirmed a Cup and Handle pattern breakout, accompanied by robust volume, which adds credibility to the breakout. Importantly, the breakout candle is a large bullish candlestick, reflecting strong buying interest and conviction among market participants. As the stock is trading at an all-time high level, all the moving averages and momentum-based indicators are suggesting strong bullish momentum in the stock. Given this strong technical setup, the stock is well-positioned for a potential continuation of its upward move in the coming sessions. Hence, we recommend to accumulate the stock in the zone of 975-965 level with a stoploss of 920. On the upside, it is likely to test the level of 1100 in the short term. Cipla The stock has registered a breakout above a downward sloping trendline on the daily chart, signalling a potential trend reversal. This breakout is further validated by volume activity, as the move was accompanied by volumes exceeding the 50-day average — a key confirmation of strength. Adding to the bullish sentiment, the stock has also managed to surpass both its short-term and long-term moving averages. Notably, the daily RSI has also broken above its own falling trendline, reinforcing the view that momentum is shifting in favour of the bulls. This confluence of price and momentum breakouts suggests that the stock may be poised for a sustained upward move. Hence, we recommend to accumulate the stock in the zone of 1540-1530 level with a stoploss of 1440. On the upside, it is likely to test the level of 1700 in the short term. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Mint
a day ago
- Business
- Mint
Nifty Pharma Index rises 1% amid weak India Stock Markets: Cipla and Laurus Labs among key gainers
Stock Market Today: The Nifty Pharma Index gained more than 1% amid a weak Indian stock market on a day when the benchmark Nifty 50 Index dipped 0.3-0.4% during the intraday trades. Cipla and Laurus Labs stood among the key gainers The Nifty Pharma index, showing its resilience, gained more than 1% during the intraday trades. The Nifty Pharma Index, which opened at 22690.50 on Monday, went to scale highs of 22,908.40, marking gains of more than 1% over the previous day's close of 22662.70. Laurus Labs, with gains of more than 7%, followed by Cipla, with gains of close to 2%, stood among key gainers. Glenmark Pharmaceuticals and Gland Pharma also gained more than 1%, helping drive gains. Nifty Pharma and Healthcare index have been showing resilience amid volatile stock markets since last few weeks While Nifty Pharma & Healthcare are the lone warriors displaying outperformance amidst this downfall in the markets, we expect sectors such as IT, Defense, Oil & Gas, Realty & CPSE to appear bearish and may continue to underperform in the near term, given their weak price structures and lackluster momentum indicators., said Sudeep Shah, Vice President and Head of Technical and Derivative Research, SBI Securities Technically, Cipla, Apollo Hospital are likely to outperform in the short term, as per Shah. The Indian Pharma index performance is also being helped by strong Indian Pharma market growth. The IPM growth during the month of June 2025 stood at a strong 11.5%, as per reports. Glemmark Pharmaceuticals, JB Chemicals and Pharmaceuticals, Mankind Pharma FDC Ltd, Alkem, Zydus, and Torrent were among the key outperformers as per Nuvama. While the pharma market is growing, the challenge is provided by rising generic sales and Jan Aushadhi Kendras. However, amidst challenges, Within formulations, Sun, Cipla, Lupin and Emcure are the top picks. of Kotak Institutional Equities Disclaimer: The views and recommendations above are those of individual analysts or brokerage companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
