Decoding the Downtrend: An Analysis of Tata Motors' Share Price Decline

Looking at the Recent Drop in Share Price TATA Motors

If you look at how Tata Motors' stock has been doing over the past year, you'll notice it has been going down, especially in the last few months . By late March 2025, the stock had lost value over different periods. For example, in one year, it went down by about 31-32%, and in the last three months, it dropped by around 11%. Over the past six months, the price fell by nearly 29% . This steady decline suggests there are some real reasons behind it, not just normal ups and downs in the market.  

To see how much the price has changed, consider this: the highest it reached in the last year was about ₹1179 around the end of July 2024 . But by late March 2025, it was around ₹710. That's a big drop of over 40%! It even hit a low of ₹606.30 in early March 2025 . This big difference between the highest and lowest prices shows that people have become less confident about the company's future over the last eight months.  

Table 1: How Tata Motors' Share Price Has Moved Recently

How the Company Has Been Doing: A Closer Look

To understand why the share price is falling, we need to look at how Tata Motors has been performing as a business.

While the company made a lot more profit in the year ending March 2024 , the more recent numbers aren't as good. The profit in the quarter ending December 2024 was much lower than in the quarter ending March 2024 . This drop in profit after a period of doing well makes investors worried. 

Table 2: Tata Motors' Key Financial Numbers  

Looking at the sales numbers for February 2025 also shows some problems . They sold about 8-9% fewer vehicles compared to the same time last year. The sales of regular cars in India also went down by about 9%. What's especially concerning is that the sales of electric vehicles (EVs) dropped by a significant 23% . Sales of trucks and buses also decreased by about 7%. While the company sold more vehicles overseas, the overall drop in sales in India across different types of vehicles suggests that people might not be buying as many Tata vehicles, or maybe other companies are selling more. The big fall in EV sales is important because Tata Motors has been a leader in this area.  

Also, if we look at the total sales for most of the year leading up to March 2025, they were down by 4% compared to the year before . Tata Motors is also facing more competition from other companies like Mahindra & Mahindra, which has been selling a lot more and is now very close to being the third-biggest seller of passenger vehicles in India . This increased competition and the fact that Tata Motors isn't selling as much as the market overall suggests there might be issues with their products or how they are selling them.  

In terms of making vehicles, Jaguar Land Rover (JLR), which is owned by Tata Motors, reportedly stopped its plan to build electric vehicles at a new Tata plant in India . This was apparently because they couldn't get the right quality of parts at the price they wanted. This could slow down Tata Motors' plans for high-end EVs and might delay the launch of their new 'Avinya' brand. However, JLR did sell 3% more vehicles to dealers in the third quarter of the financial year 2025, which is a bit of good news after some earlier problems with getting parts .  

Tata Motors has announced some new vehicles coming soon, like the Harrier EV (expected in April 2025) and the Sierra (both regular and electric versions, likely later in 2025 or early 2026) . They also plan to launch a new luxury EV brand called 'Avinya,' with the first car expected next year . While these new products show they are thinking about the future, they probably won't have a big impact on the current fall in share price right away

What's Happening in the Market: India and the World

To really understand what's going on with Tata Motors, we need to look at the bigger picture of the car market. In India, the market for regular passenger vehicles grew slightly, by about 2-4%, in February 2025 . One big trend is that people are buying more SUVs . Even though the market grew overall, Tata Motors' sales of regular cars went down during this time . This means they might not be taking advantage of what people are currently wanting to buy, especially SUVs. There are also reports that high loan interest rates and a general slowdown in the car industry are making it harder for some companies to sell cars .  

Things happening around the world are also affecting Tata Motors, especially through JLR. Recently, the US President announced a plan to put a 25% tax on all cars imported into the US, and this has made Tata Motors' share price fall . The US is a big market for JLR, where they sell a lot of their cars. These new taxes, expected to start around April 2nd, 2025, will make JLR cars more expensive in the US, which could hurt their profits and make them less competitive. This change in US policy is a direct problem for a large part of Tata Motors' business. Also, JLR sold fewer cars in China and the UK in the third quarter of the financial year 2025, showing they are facing difficulties in other important countries as well . 

How Does Tata Motors Compare to Other Companies?

Looking at how Tata Motors is doing compared to its competitors can give us more clues. Tata Motors' stock price compared to its earnings (called the P/E ratio) is quite low (around 8.25) compared to some other car companies in India . This lower value might mean that the market isn't expecting the company to make a lot more profit in the future. As we mentioned before, Mahindra & Mahindra is selling a lot of cars and is very close to overtaking Tata Motors in terms of market share . In February 2025, while Tata Motors' sales of regular cars went down, several of its main competitors, like Maruti Suzuki, Mahindra, and Kia, sold more cars . This suggests that Tata Motors is facing some specific issues that its competitors aren't.  

Table 3: Comparing Stock Performance and Value (as of March 24, 2025)

What Experts Are Saying

Experts who watch Tata Motors seem to have different opinions . Some are still positive and think the share price will go up, while others are more worried about the company's future, especially in the short term. Several reports point out that the US tariffs are a big concern because JLR sells so many cars in the US . Analysts have also been worried about how many JLR cars will be sold in the future and how profitable they will be, as well as how quickly people will switch to electric vehicles . These different views from experts show that the situation with Tata Motors is complex and uncertain. 

Problems Ahead

Tata Motors is facing several challenges that seem to be causing its share price to fall. These include: 

• Selling fewer regular cars, trucks, and electric vehicles in India.
• More competition in the electric vehicle market, leading to a big drop in their EV sales and how much of the market they control .  
• The new US taxes are expected to significantly hurt the profits of their Jaguar Land Rover (JLR) business .  
• JLR is selling fewer cars in important international markets like China and the UK .  
• A setback in their plans for high-end electric vehicles because JLR's EV production in India was put on hold .  
• Raising prices to cover higher costs might lead to selling fewer vehicles overall .  
• Experts have already been concerned about JLR's profits, how fast people will buy electric vehicles, and the company's service .  
• Other car companies in India are growing faster and selling more

What's Next: The Company's Plans and How Investors Feel

Tata Motors has announced some plans for the future, like launching new SUVs and EVs, building more EV charging stations, and focusing on selling in other countries . The company's leaders have also said they are confident they will meet their financial goals for the year ending in March 2025 . However, investors might still be cautious in the near future because of the recent financial results, lower sales, and the big risk from the US tariffs. How well the company launches its new products and deals with these problems will be key to how it performs in the future and whether investors become more confident again. People will be watching the financial results for the last quarter of the year closely to get more information .

 In Conclusion

The recent fall in Tata Motors' share price seems to be happening because of a mix of reasons. The company's profit has gone down, and they are selling fewer vehicles in India, especially electric vehicles. They are also facing more competition. But the biggest immediate problem seems to be the new US taxes, which could really hurt the profits of their Jaguar Land Rover business. While Tata Motors has plans for the future that could help them do better, these current challenges are likely to keep investors worried for a while. We need to keep an eye on the company's upcoming financial reports and any changes in global trade to see where Tata Motors and its share price are headed.  .