While the Tata Motors demerger into commercial and passenger vehicle businesses seems to be a step in the right direction, Motilal Oswal said it does not foresee any need to revisit its target price, which is already based on SoTP valuation.
Despite factoring in most of the positive triggers, it sees limited upside potential for Tata Motors given the recent sharp run-up in the stock. The brokerage has downgraded Tata Motors to 'Neutral' from 'Buy' with an unchanged target of Rs 1,000 per share.
On the back of a strong performance across its key business segments, the stock has significantly outperformed key indices with 204 per ecnt return in the last 36 months against 50 per cent return in the Nifty.
Also, we have already factored in most of the positive triggers in our estimates. Given limited upside after the recent sharp run-up in the stock, we downgrade Tata Motors to Neutral," it said.
Nomura India also suggested an unchanged price target of Rs 1,057 on Tata Motors. This brokerage, however, believes that the Tata Motors PV business potential to create better value over the next few years.