Tata Motors Q1 results| How to trade in Tata Motors ahead of its first quarter results?

According to experts, Tata Motors could post strong growth in the first quarter of FY25, led by higher sales in JLR (Jaguar Land Rover) and the commercial vehicle segment.

Tata Motors' first-quarter revenue could grow 5%-7% YoY in the range of ₹1,08,000 crore to ₹1,08,100 crore, while its net profit could grow significantly by 50%-53% YoY in the range of ₹5,000 crore to ₹5,100 crore.

During the upcoming earnings call, investors and traders will be keen to hear management's comments on the outlook for demand, particularly in the commercial vehicle segment, and on the performance of JLR.

Ahead of the Q1 result announcement, Tata Motors shares are trading 1% lower at ₹1,142 at 12:42 pm. This year, Tata Motors has surged over 49%. Recently, Tata Motors joined the elite club of the world's top ten most valuable automotive companies with a market capitalisation of USD 51 billion.

Technical View

Tata Motors broke out of its 5-month long consolidation last week and zoomed past its previous all-time high (₹1,065). The stock formed a bullish engulfing pattern last week and posted gains of 13%. This indicates strength and the emergence of fresh buyers around the previous resistance zone. As you can see on the chart below, the stock has immediate support at the previous all-time high zone, which previously acted as resistance.

On the daily chart, the stock is consolidating its gains at higher levels after the recent breakout. In the last three trading sessions, the stock has traded between ₹1,179 and ₹1,118. Short-term traders can watch the breach of this range for further directional clues.

Options build-up

Options data as of 1 August shows significant call and put open interest (OI) at the 1,100 strike, suggesting range-bound activity around this level. The stock also has highest call and put open interest at the 1,200 and 1,000 strikes, respectively, for the August expiry.

The ATM strike for Tata Motors on 29 August is 1150, with both the call and put options priced at ₹76. This suggests an implied price movement of approximately ±6.6% at 12:30pm on 1 August. However, let's take a look at Tata Motor's historical price behaviour during past earnings announcements.

Options strategy for Tata Motors

Based on options data suggesting a potential price movement of ±6.6%, traders have the opportunity to engage in either a long or short volatility strategy.

Disclaimer

Derivatives trading must be done only by traders who fully understand the risks associated with them and strictly apply risk mechanisms like stop-losses. The information is only for educational purposes. We do not recommend any particular stock, securities and strategies for trading. The stock names mentioned in this article are purely for showing how to do analysis. Take your own decision before investing.