Tata Motors only loser among auto stks in 2022. Can it recover lost ground?

Within the auto sector, TVS Motors has soared 79 per cent far this year. Mahindra & Mahindra and Eicher Motors were the other major gainers.

Shares of Tata Motors tanked 5 per cent on Thursday after the company missed Street estimates by posting higher-than-expected loss for the September quarter (Q2FY23). Even though, the company reported a narrower loss of Rs 944.61 crore compared to Rs 5,006 crore in the corresponding quarter last, issues related to JLR margins, semiconductor supply and the prevailing challenges in the automobile industry weighed on the investor sentiment.
 

So far this year, the stock performance of Tata Motors has been disappointing, with the stock down 14 per cent on a YTD (Year Till Date) basis. Since the rebound post Covid-19 sell-off, most of the Nifty 50 constituents have hit new all-time highs, whereas the Tata Motors, also a major constituent, has failed miserably and currently traded 31 per cent lower from its all-time peak of Rs 604, recorded way back in 2015.

With the automobile sector, too, Tata Motors is the lone stock to deliver negative YTD returns. Whereas, the top performer has been TVS Motor Company - up 79 per cent so far in 2022, and the least gainer, i.e. Hero MotoCorp has advanced 12 per cent.

Source: spidersoftwareindia

 

Given the negative returns so far, should you be worried as an investor? Here's what the chart suggests:-
 

In the recent past, Tata Motor has seen accumulation in the Rs 375 to Rs 360 range, which was the breakout range in November 2021. Post which, the stock rallied as much as 48 per cent to hit a 52-week high at Rs 536.70. 

So going ahead, as long as the stock defends this cushion range of Rs 375 to Rs 360, one can observe a bullish bias at the counter for the medium-term. The counter could see an accumulation again, probably now closer to Rs 400 level, hints the weekly chart.

Recently, in July 2022 Tata Motor did breakout and surpassed Rs 463 hurdle, rallying all-the-way to Rs 494; eventually it retraced back to its support base around Rs 400 mark. Now, if the stock demonstrates sustainability and crosses the 200-day moving average (DMA) set at Rs 440, a fresh positive rally could emerge with Rs 500 in sight. CLICK HERE FOR THE CHART