Tata Motors Stock Surges Amid US-UK and India-UK FTAs
US President Donald Trump, Tata Motors Cars, and UK PM Keir Starmer (Image credit X.com)
Tata Motors Stock Gains Amid Equity Market Meltdown Amid India-Pakistan Conflicts
By S Jha
MUMBAI, May 9, 2025 – Shares of Tata Motors Ltd. rallied over 3% today, extending gains for a third consecutive session, amid stock market crash on Friday. Investor optimism soared following reports of a potential US-UK Free Trade Agreement (FTA) and the recently signed India-UK FTA.
Tata Motors owns luxury carmaker Jaguar Land Rover (JLR). The stock hit an intraday high of ₹706.30 on the NSE, marking a 9% surge over two days. The stock is still far away from its peak of ₹1179.
Experts attributed the rally to reduced tariffs and enhanced market access for JLR, alongside Tata Motors’ strategic demerger plans.
The India-UK FTA, finalized on May 6, slashed automotive tariffs from over 100% to 10% under quotas, potentially lowering JLR vehicle prices in India by up to 50%. Simultaneously, a New York Times report suggesting an imminent US-UK trade deal, hinted at by US President Donald Trump on Truth Social, has boosted sentiment, as the US accounts for nearly 25% of JLR’s sales.
These developments, combined with Tata Motors’ approved demerger of its commercial vehicle business, have positioned the company as a key beneficiary of global trade shifts.
On X, @abhymurarka, a market commentator, noted, “Tata group companies have a significant revenue share from the UK. Possible reason why Tata Motors is up ~4% after the India-UK FTA finalization. Europe is an auto hub.”
He also suggested that a potential India-US trade deal could further benefit Tata Steel, highlighting the broader Tata Group’s global exposure.
Similarly, @amil_sharma28, an X user tracking market trends, posted, “Tata Motors up by 5% after the India-UK FTA. Tata Steel could rise with the India-US trade deal next.” The user emphasized Tata Motors’ revenue from the UK, underscoring JLR’s role in driving stock gains.
Market participants also linked the stock gain to a report that detailed the stock’s momentum and citing analyst optimism, with 20 of 34 Bloomberg-tracked analysts maintaining a ‘buy’ rating on Tata Motors.
Analyst Mitesh Panchal, a SEBI-registered investment advisor, told Business Today, “Tata Motors will be a clear beneficiary of the FTA agreement. Investors should accumulate in the Rs 680-700 range, with short-term targets of Rs 780-820.”
JLR has a plan to set up a plant in Tamil Nadu to co-develop models for domestic and international markets. This may potentially align with India-UK. UK-US, and India-US FTAs in near future, claimed market participants.
Despite the bullish sentiment, some caution persists. @ETMONEY, a financial advisory platform on X, warned, “The India-UK FTA is a positive for Tata Motors. However, the FTA is not a silver bullet. Growth challenges still linger.”
The stock’s 30% recovery from its April low of ₹542.55 reflects strong momentum, but it remains below key moving averages, signaling potential volatility.
Tata Motors’ market capitalization stands at ₹2.53 lakh crore, bolstered by JLR’s 14.4% wholesale volume growth in North America and 10.9% in Europe for Q4 FY25. As global trade dynamics evolve, investors are closely watching Tata Motors’ ability to leverage FTAs and its restructuring to sustain this rally.
(This article makes no recommendation for buy or sell of shares of any company)
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