CLSA upgrades Tata Motors to outperform

MUMBAI: CLSA Asia-Pacific Markets upgraded its rating on Tata Motors to 'outperform' from 'underperform', while raising its price target to Rs215 from Rs160. Tata Motors could perform better than its Indian peers, which are more exposed to a visibly slowing Indian economy, the brokerage said.

"In India, we are cautious on M&HCV and car outlook but are more upbeat on Tata's LCVs," CLSA said, while raising its consolidated earnings per share estmates by 6-32%, led by volume growth in Jaguar and Land Rover.

"Profit outlook for JLR has improved substantially given the remarkable resilience of western world premium vehicle demand despite weakening macros, continued strong growth in China, sterling response to the 'Evoque' and favourable currency outlook," the brokerage said. "As such, our earlier fears of a large decline in western world demand appear overdone, although our forecasts are still below management guidance," it added.