Tata Motors And Tesla Joint-Venture The Reason For Tata's Highest Stocks In A Year?

Tata Motors’ shares have been on an upward trajectory since the start of this week. Yesterday, the automaker’s stock saw a growth of 20% on the NSE, the highest it has been in about 52 weeks. It would be an understatement to say that there has been a lot of interest for the reason behind this surge in Tata Motors’ shares. One of the key reasons for this sudden surge were the reports that the home-grown automaker is about to seal a deal with US-based electric car manufacturer Tesla to make and sell the latter’s EVs in India. Reports suggest that the two companies were about to sign an MOU too, which would see Tesla vehicles being produced in India using Tata’s production facilities.

Unfortunately, these reports were all wrong. Yesterday Tesla Motors did talk about its India operations and there were no mentions for Tata Motors. The EV maker has formalised its entry in the Indian auto market by setting up a local entity, Tesla Motors India and Energy Private Limited. The registered office for this company is in Bengaluru and the state's chief minister BS Yediyurappa also took to Twitter to congratulate Tesla CEO Elon Musk.

To clear up any further issues, Tata Motors issued a statement to clarify the media reports currently surrounding the company, its PV business, and the rumoured partnership with Tesla. Tata Motors said, "Tata Motors has not taken any decision regarding a strategic partner for its PV business and categorically denies any and all rumours suggesting the same." A company spokesperson also said there's no truth to the reports of a Tata-Tesla partnership in India. 

But was the rumoured joint venture with Tesla the only factor in Tata Motor’s highest stocks in 52 weeks high? In a word, no. The more significant factor driving this rise was actually Tata Motors’ as well as Jaguar Land Rover’s sales data. As per the figures for December 2020, the automaker’s domestic business posted a 21% YoY growth, while JLR’s sales also posted a 13% YoY growth in December. This was the overshadowed but just as important factor in the stock surge for Tata.