Tata Motors, Rakesh Jhunjhunwala owns, is poised for a 20% increase
Analysts at ICICI Direct believe that, following the recent correction. Auto sector stocks may now regain momentum as part of a sustained broader market recovery, from which Tata Motors stands to benefit.
Tata Motors, owned by Rakesh Jhunjhunwala, has seen its share price fall 13 percent this year. With the most recent drop occurring as foreign investors book profits. However, analysts at ICICI Direct believe that, following the recent correction. Auto sector stocks may now regain momentum as part of a sustained broader market recovery. From which Tata Motors stands to benefit. According to ICICI Direct’s analysis of Tata Motor derivative data, there has been new long accumulation at lower levels in the stock.
“In the current fall, the stock has dropped sharply due to heavy FII selling but has found support near 380. It has been crawling towards its Call base of 450 since then. With significant OI addition in the future segment, indicating fresh long accumulation at lower levels,” ICICI Direct said.
Tata Motors has the highest Call option base at the 500 strikes, followed by the 450 strikes.
“The near-money call strike of 430 and 440 in has begun to close. Which could provide much-needed momentum in the current expiry itself,” the report added. In addition, put open interest base is firming up at the 420 and 400 Put strike levels, from which the stock has fallen sharply.
Furthermore, ICICI Direct stated that has previously taken support near Rs 380-400 levels. “Also, given the significant delivery volume activity in October 2021 and early March 2022. These levels appear critical.” In such a case, the positive bias in the stock may persist until these levels are maintained,” they added. Analysts predict a three-month trading period.
According to bourse data, renowned investor Rakesh Jhunjhunwala owns 1.2 percent of the automaker. Rakesh Jhunjhunwala, dubbed “the Big Bull,” owns 3,92,50,000 equity shares in Tata Motors, accounting for 1.2 percent of the company.
