Tata Motors CV Jumps 3% As Q1 Beat, Upbeat FY27 Outlook Cheer Street

Shares of Tata Motors Commercial Vehicles (TMCV) rose more than 3% on Thursday after the company reported a steady performance for the June quarter (Q1FY27) and struck an optimistic tone on demand, prompting positive reactions from brokerages.

The stock was trading 3.4% higher in early trade, while Tata Motors Passenger Vehicles also gained over 2%.

TMCV reported a 23% year-on-year increase in revenue to ₹19,329 crore from ₹15,682 crore in the year-ago quarter.

EBITDA rose 16% to ₹2,183 crore from ₹1,890 crore, although the EBITDA margin moderated to 11.3% from 12.1% a year earlier due to commodity cost inflation.

Vehicle volumes grew 27% year-on-year but declined 18% sequentially. The company also improved its domestic market share by 207 basis points year-on-year and 110 basis points quarter-on-quarter.

Company Raises FY27 Demand Outlook

The company revised its FY27 medium and heavy commercial vehicle (M&HCV) demand growth forecast to 8% from its earlier estimate of 5% and expects healthy double-digit M&HCV volume growth in the second quarter.

Management said electric vehicle demand remains strong, with EV penetration in the small commercial vehicle segment reaching 10% as ownership economics continue to improve.

The company also said deliveries under its Indonesia export order are expected over FY27 and FY28. While commodity cost pressures are likely to persist, management expects the 2.5% price hike implemented in July and ongoing cost-control measures to offset part of the impact.

TMCV also said the proposed acquisition of Iveco is expected to be completed by early November 2026, subject to regulatory approvals.

Brokerages Turn More Bullish

Nomura upgraded the stock to 'Buy' from its earlier rating and raised its target price to ₹554, citing stronger-than-expected quarterly performance and improving demand prospects.

The brokerage said EBITDA exceeded expectations across segments and expects margins to improve further following the July price hike.

CLSA maintained its 'Outperform' rating with a target price of ₹596. It noted that the company's Q1 EBITDA margin of 11.3% was around 50 basis points ahead of consensus estimates despite a 340-basis-point drag from commodity inflation.

According to CLSA, operating leverage and price hikes partly offset higher input costs, while the company continues to expect healthy commercial vehicle demand and double-digit volume growth in the current quarter.

Passenger Vehicle Arm Also Advances

Shares of Tata Motors Passenger Vehicles gained over 2% after the company reported a 59% year-on-year rise in total sales to 63,760 units in July.

Domestic passenger vehicle sales increased 58% to 62,611 units, while international passenger vehicle sales rose 76% to 1,149 units. Electric passenger vehicle sales more than doubled, climbing 114% year-on-year to 15,217 units during the month.