It is a tough time for vehicle producers. VW is in trouble, BMW as well, the only car producer stock performing fairly good is Tesla.
Tata Motors will have to use magic in order to survive this crisis and to bring back the smile on the faces of investors. Tata (NSE: TATAMOTORS) stock lost 60% year-to-date and it seems like there is a long recovery ahead of Tata Motors shares.
Seems like COVID-19 crisis did something to big corporations that will have a long lasting impact. First everyone stopped working, then people lost their jobs, follows a long recovery road and at the end more people will lose jobs and some companies will go down.
According to RushLane, there are more troubles in sight for Tata Motors. Amid China-India tensions “Chery Automobile has halted its plans to acquire stakes in Tata Motors’ PV business due to the Indian government’s recent directive to scrutinize all Chinese investments in the country.”
Furthermore, in Europe, Tata Motors and its British subsidiary, Jaguar Land Rover (from where Tata Motors is usually pulling most of its profits) is struggling with sales and besides this the yield on JLR bonds has more than doubled since the pandemic blew out. Because of this Tata Motors decided not to raise the cash and asked British government for bailout.
This probably wont happen and stock will take a long “L shape” recovery.