Exit Tata Motors on rallies, says Dhawan

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Exit Tata Motors on rallies, says Sajiv Dhawan of JV Capital Services.

Dhawan told CNBC-TV18, "Tata Motors has had and incredible run over the last one year, the great outperformer in most of the auto stocks. A lot of the positive news is already factored in, lower input costs, lower interest rates both of which are likely to rise, great sales figures over the last one year and will that continue with higher interest rates its hard to say."

He further added. "On the back of the Jaguar news the stock had rallied strongly, so when a company is relied on another company heavily abroad then it makes difficult for domestic investors to trade or invest more in the stock."

"The debt of the company is reasonably high, so I would prefer to look at any serious rally in the stock to exit. I would be more comfortable invested in the two wheeler sector in Hero Honda or Bajaj Auto. So maybe Rs 900 is reasonable target but I am a bit doubtful on that sort of an out performance."

Yesterday the share closed at Rs 761.50, down Rs 9.4, or 1.22%. Market capitalisation stands at Rs 41,422.55 crore.

The company touched its 52 week high Rs 842.00 and 52 week low Rs 146.70 on 05 Jan, 2010 and 12 Mar, 2009, respectively. Currently, it is trading -9.56% below its 52-week high and 419.09% above its 52-week low.