Tata Motors ends 5% higher on hopes for new Range Rover

NEW DELHI: Shares in Tata Motors closed over 5% in trade on Wednesday, on growing anticipation of a boost in sales when the auto maker releases a fourth-generation Range Rover in the month of October.

Tata Motors closed 5.3 per cent higher at Rs 262.80. It has hit an intraday low of Rs 251 and a high of Rs 263.50.

The new model will retain the look of the sports utility vehicles, but is expected to be lighter and accommodate smaller engines, analysts say.

J.P.Morgan expects the new Range Rover to weigh about 420 kgs less than existing models, with a price of GBP 71,000 onwards, according to a note dated on Monday.

Jefferies expects 10 percent growth in Range Rover volumes in fiscal 2014. "Successful launch of Range Rover could add significantly to earnings," Jefferies said in a note last week.

Technical Check: Mudit Goyal, Technical Analyst, SMC Global Securities:

The stock has been moving sideways in the range of Rs 210-250 levels for the past three months. Currently, it is forming the 'Inverted Head and Shoulder' formation on the daily charts which is considered to be bullish.

Yesterday, the stock ended marginally higher and subsequently gave neckline breakout on high volume. Tata Motors is comfortably resting above its 200-EMA on daily chart and therefore traders can initiate long positions for target of Rs 270-275 with stop-loss of Rs 247.