Tata Motors Share Price Slumps Over 5% Amid JLR Margin Concerns

Market Performance: Tata Motors Share Faces Sharp Decline

Tata Motors' share price experienced a significant 5.5% drop in early trade on Monday, reaching a day's low of ₹672.75 on the BSE.

• From its 52-week high of ₹1,179.05, the stock has now declined by approximately 43%.
• As of 10:27 AM, the share was trading at ₹681.90, down 4.3%.
• The stock has declined by 31.40% over the last year.
• Year-to-date (YTD), Tata Motors shares are down 9%.

This recent downturn marks a period of sustained pressure on Tata Motors' stock performance.

Main News: US Tariffs and JLR EBIT Margin Outlook Trigger Sell-Off

The sharp fall in Tata Motors' share price has been linked to its updated FY26 EBIT margin guidance for its UK-based luxury brand, Jaguar Land Rover (JLR).

• Tata Motors now expects EBIT margins between 5% and 7% for JLR in FY26.
• This projection is notably lower than the previously targeted 10% margin.
• For FY25, JLR had reported a healthy EBIT margin of 8.5%.

The downgrade comes at a time when the US has imposed a 25% tariff on foreign-made vehicles, directly impacting JLR's exports to one of its key markets.

Company Details: JLR's Heavy Revenue Contribution Makes Tata Motors Vulnerable

Tata Motors' exposure to global policy changes is high due to JLR's substantial contribution to its overall business:

• In FY25, JLR contributed 71% of Tata Motors' total consolidated revenue.
• It also accounted for 80% of the company's overall profitability.

The US tariff has led JLR to temporarily halt shipments to the United States, reflecting the significant impact on its operations.

Additionally:

• JLR had reported free cash flows of £1.5 billion for FY25.
• For FY26, this is expected to drop close to zero, adding further pressure on the financials.

Summary: Tariff Troubles and Margin Forecasts Weigh on Tata Motors Share

Tata Motors shares plunged over 5% due to concerns surrounding the reduced EBIT margin outlook for JLR and the financial strain caused by US-imposed tariffs.

The stock has seen a steep decline from its previous highs, with overall performance showing significant erosion in shareholder value.

With JLR contributing the lion's share to both revenue and profitability, the impact of external global factors, such as tariffs, is reflected in Tata Motors' share price trajectory.