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Thanks to several factors working in favour of the company, the Tata Motors stock gained about 2 per cent earlier today.
For one, being the market leader in truck and bus segments, the company reported a 7 per cent growth in medium and heavy truck/bus sales in August 2014 over August 2013, selling about 9,141 vehicles. This brings in a ray of hope for a turnaround in commercial vehicle sales, which has been awaited since the beginning of this fiscal.
New orders
What adds credence to this hope are the bus orders from Karnataka and Himachal Pradesh which the company had received on Tuesday. The company will be supplying about 1,250 Tata Marcopolo buses under the JNNURM II scheme to these states.
Jaguar Land Rover business
That the Jaguar Land Rover business is on a roar, also helps. The company is consolidating its position in China, one of its fast growing markets, by setting up a joint venture to aid local manufacture. At the same time, developed markets of the UK, the US and some countries in Europe are rebounding after the slowdown.
Rich product mix, helped by higher sales of Range Rover and the new Ranger Rover Sport along with the favourable market mix, helped JLR’s operating margins reach 20 per cent in the June 2014 quarter. Expected gains from the upcoming launch of the Jaguar XE next week is also keeping the investor sentiment buoyant.
The icing on the cake seems to be S&P ‘s revised outlook for Tata Motors from stable to positive.
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