Tata Motors CV Shares Gain Attention as Two Brokerages Initiate Buy Calls

Shares of Tata Motors Commercial Vehicles Ltd. (TMLCV) came under investor focus following positive coverage initiations by two leading global brokerages. JPMorgan launched coverage with an 'overweight' rating, while Bank of America Securities assigned a 'buy' rating. Both firms set an identical target price of Rs 475 per share. This target implies a potential upside of around 23% from prevailing levels at the time of the reports. The endorsements highlight TMLCV's robust positioning in India's commercial vehicle market. Analysts pointed to disciplined operations and growth prospects as key drivers for the optimistic outlook heading into 2026.

The company, formerly the commercial vehicle arm of Tata Motors, became a standalone entity through a demerger effective October 1, 2025. Shareholders received one TMLCV share for every share held in the original Tata Motors on the record date of October 14, 2025. The passenger vehicle business, including electric vehicles and Jaguar Land Rover, remained under a renamed Tata Motors Passenger Vehicles Ltd. (TMLCV), listed on the BSE and NSE in November 2025, debuting at a premium to its implied valuation. This restructuring aims to allow each unit sharper strategic focus, better capital allocation, and independent growth trajectories. The separation has enabled clearer valuation of the pure-play commercial vehicle operations.

JPMorgan's analysis emphasized TMLCV's strong domestic discipline alongside opportunities from international expansion. The brokerage anticipates modest demand recovery in the commercial vehicle segment, supported by ongoing infrastructure development in India. It highlighted the potential value from recent acquisitions, noting they were executed during favorable market conditions. JPMorgan forecasts a 13% compound annual growth rate for EBITDA and 16% for EBIT over fiscal years 2026 to 2028. These projections underpin expectations of a significant valuation re-rating for the stock. Overall, the firm views TMLCV as well-placed for sustained performance.

Also Read: Bhavish Aggarwal Sells Another Lot of Ola Electric Shares for Rs 142 Crore

Bank of America shared a similarly bullish stance, predicting a recovery in both Indian and European operations. The brokerage expects steady market share gains, driven by margin discipline and reduced regulatory pressures. It projects a high return on capital employed of approximately 35%. Bank of America anticipates a 15% EBITDA CAGR from FY26 to FY28. Like JPMorgan, it sees strategic acquisitions as timely, positioned to generate synergies over the medium term. The aligned views from both houses reinforce confidence in TMLCV's stable growth trajectory amid evolving industry dynamics.

The identical target prices and converging rationales signal growing institutional interest in TMLCV post-demerger. India's continued emphasis on infrastructure and logistics bodes well for commercial vehicle demand, where TMLCV holds leadership. Cyclical challenges persist in the sector, including commodity fluctuations and economic sensitivities. Investors will likely track quarterly results, demand indicators, and integration progress closely. The brokerage calls underscore the potential for TMLCV to capitalize on its focused mandate in a recovering market environment.

With the demerger unlocking distinct value propositions, TMLCV stands out as a dedicated player in trucks, buses, and related mobility solutions. Broader market sentiment and macroeconomic factors could influence near-term stock movements. The positive initiatives provide a constructive backdrop as the company navigates fiscal 2026. Market participants anticipate further clarity on operational efficiencies and global contributions in upcoming updates. This development positions TMLCV for potential sustained upside in the eyes of major analysts.

Also Read: SEBI Revises Expense Ratio And Brokerage Caps For Mutual Funds