Tata Motors announced on March 7 that it will increase the prices of its commercial vehicles, effective April 1, 2024, by up to 2 percent. The price increase is to offset the residual impact of the past input costs, the automaker said.
While the price increase will vary as per individual model and variant, it will be applicable across the entire range of commercial vehicles, the company said in its stock exchange filing.
This marks the second occasion in 2024 that Tata Motors has announced a hike in commercial vehicle prices. Tata Motors increased the price of its CVs by up to 3 percent effective January 1, 2024.
Previously, Tata Motors announced a price hike of an average of 0.7% across its complete range of passenger vehicles, including electric vehicles (EVs), with effect from February 1, 2024.
The automotive manufacturer informed the stock exchanges of its decision to demerge its businesses into two separate listed entities, namely the commercial vehicles (CV) and passenger vehicles (PV) businesses. PVs include electric vehicles (EVs) and Jaguar Land Rover (JLR).
The company's decision to split its passenger and commercial vehicle businesses was cheered by brokerages. While global brokerage firm Morgan Stanley assigned an 'overweight' call on Tata Motors on March 5, Nomura has a “buy” call and a target price of Rs 1,057, which is a 7 percent upside from the current market price. It said in the medium term, the businesses should be able to pursue their respective strategies with greater freedom. And, rating agency Moody's on March 6 said that it has affirmed Tata Motors’ BA3 ratings with outlook remaining positive.
Tata Motors’ proposed demerger plan will help the company reap the best of both worlds, according to analysts tracking the stock.
Over recent years, the company's commercial vehicle, passenger vehicle that include electric vehicle too, luxury vehicle Jaguar Land Rover (JLR) businesses have implemented distinct growth strategies and, began functioning independently under their respective CEOs since 2021, according to Tata Motors.
On March 7, at 2.32 pm, the stock was trading at Rs 1039.50 apiece at the NSE, which was 2.15 percent higher or Rs 21.85 as against the previous day's close. On March 5, the stock hit a 52-week high of Rs 1,065.60.
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