Tata Motors stock continues its downward streak, dropping for the fourth straight session to ₹688.9 on the NSE, a fall of nearly 7% in under a week amid mounting investor concerns.
This slide follows rising investor anxiety about Tata Motors’ upcoming demerger and JLR’s weak quarterly performance.
To make matters worse, technical charts indicate that the stock is hovering near key support levels, which is never a comforting sign for traders.
Add to that a bit of weakness across the broader auto sector, and it’s easy to see why the mood around Tata Motors has turned a little jittery.
Why is Tata Motors stock sinking?
Investor sentiment around Tata Motors has taken a clear hit, thanks to a rough quarter for its luxury arm, Jaguar Land Rover (JLR).
The automaker’s Q2 FY26 numbers were disappointing, wholesale volumes were down 24% year-on-year, and retail sales fell 17%.
A big part of the problem? A major cyberattack in September that threw production and global deliveries off track.
JLR only started ramping things back up from October 8, right as it was phasing out older Jaguar models and dealing with higher tariffs in the US and China that further squeezed margins.
Analysts haven’t minced words either. ICICI Securities still has a “buy” rating on Tata Motors but cautioned that short-term financial pressure is unavoidable.
Nomura went a step further, estimating that JLR’s net debt could climb to around GBP 1.65 billion, though it expects things to stabilize once production gets back to normal.
The UK market felt the brunt of the slump, with retail sales plunging over 32%.
Still, strong demand for high-margin models like the Defender and Range Rover could give JLR the cushion it needs to bounce back in the coming quarters.
Demerger uncertainty adds to market nervousness
The upcoming demerger has definitely added to the market jitters.
Set to take effect from October 1, with a record date of October 14, Tata Motors will officially split into two separate entities, one for Passenger Vehicles (PV) and another for Commercial Vehicles (CV).
Shareholders will get one share in the new CV company for every Tata Motors share they currently hold.
On paper, this move is supposed to bring clarity and help each business focus better on its strengths.
But in reality, investors are feeling uneasy. There is a lot of chatter about how the split will be valued, whether the timing is ideal, and what kind of tax implications might follow once the transfer is done.
Adding to the caution, traders haven’t been allowed to take new leveraged positions (like F&O or MTF trades) ahead of the demerger, which has slowed down overall trading activity.
Plus, some investors who made profits earlier in the month seem to be cashing out before things potentially get choppy around the ex-date, fueling the latest round of selling.
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