Why are experts suggesting investing in Tata shares?

Tata shares

Tata Group is the largest conglomerate in India with an interest in food and beverages, hospitality, technology, automobile, electronics, and financial services industries. It is one of the oldest and most recognisable brands in India.The 30-odd listed companies that the Group owns have grabbed investor attention in recent years thanks to their superlative performance. 

The key among them is Tata Consultancy Services, the biggest company in its portfolio, Tata Steel, Tata Motors, Tata Power, Indian Hotels, Tata Elxsi, etc.Analysts are also bullish on several of these stocks, including Tata Power share price. Some of the reasons behind their bullishness are:

Titan: It is a jewellery and watchmaker and retailer owned by the Tata Group. Analysts at ICICIdirect say their optimism on the stock stays intact. This is one company where the capabilities to translate the opportunity to earnings is high, they say. The company already has a strong presence in Northern India and now its venture into South India has also started bearing fruit, which has enthused analysts.

Tata Motors: The company is the largest auto companies in India and owns luxury car maker Jaguar Land Rover and commercial vehicle maker Tata Daewoo. In the domestic market, the company has been grabbing market share at a rapid pace. Analysts expect a healthy 15.6 per cent revenue compound annual growth rate over FY22-24 backed by 17.7 per cent total volume CAGR amid a healthy order book at JLR. Besides, it has taken a lead in the electric vehicle segment that will also reap dividends, analysts say.

Tata Chemicals: The company makes several chemicals that are used by other industries including soda ash, sodium bicarbonate, cement, salt, marine chemicals and crushed refined soda. Analysts at ICICIdirect say the improvement in the soda ash pricing environment bodes well for the future growth outlook. 

Meanwhile, a revival in export demand for the North American unit to sustain group performance and a higher share of speciality business will help it command better valuations for the overall group.

Rallis India: It is a leading agrochemical company that primarily makes soil nutrients and speciality chemicals. It has a diversified portfolio and a strong channel network of more than 6,700 dealers and 79,000 retailers. Analysts at ICICIdirect said good growth momentum in the crop nutrition segment can lead to decent gross margins ahead, leading to better share performance. 

Lower pricing pressure for key molecules in the international market is also a key driver, the analysts said, adding, there is better volume growth visibility now.

Tata Power: It is an electricity and transmission company having primary operations across India. The stock has gained momentum given a better growth outlook and its foray into renewable electricity. Tata Power has one of the largest solar electricity portfolios in the country. Its Mundra plant has struggled in the past and the coal business has also started delivering, improving the allure of the Tata Power share price.