Tata Group shares: Biggest winners and losers so far in 2022

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How Tata Group shares fared in the face of market volatility

Since the start of the year, Indian stock markets have had a bumpy ride.

The BSE Sensex has swung like a pendulum after hitting an all-time high of 61,200 in January 2022.

The index fell to 52,800 in March 2022, then jumped to 60,000 in April 2022 before falling back to 52,100 in June 2022.

Amid this volatility, even fundamentally sound companies are having a hard time.

The Sensex and Nifty are down more than 11% in 2022.

The Tata Group is no exception. However, since the group has companies that span all sectors, some have made gains while others have seen losses.

Here is a list of the Tata Group’s best winners and losers in 2022 so far.

Top winners –

#1 Tata Elxsi

First on our list is Tata Elxsi.

Shares of the company have soared 26% this year on strong growth prospects.

Tata Elxsi focuses on design thinking and the application of digital technologies in high-growth verticals that are expected to experience strong growth through increased research and development spending.

The company is one of the world’s leading providers of design-based technology services across all industries.

Over the past year, Tata Elxsi has experienced dramatic growth in sales, profitability and customer acquisitions across all major divisions.

The company’s goal for 2023 is to grow sales, maintain leading margins of 22% and manage business risk through revenue diversification.

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With a large global customer base, the company continues to grow its market share and improve its position in the industry with aspirations to expand its capabilities in healthcare and transportation.

In the transport sector, the company intends to enter the rail market by collaborating with the largest operators and metropolitan and rail authorities around the world.

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#2 Indian Hotel Company (IHCL)

Second on our list of top winners is Indian Hotel Company Limited (IHCL).

The stock is up 18% in 2022 thanks to a positive trading outlook.

The IHCL also recently announced its “Ahvaan 2025” plan. In this context, IHCL will reorganize its margins, reinvent its brand landscape and restructure its portfolio.

The company aims to build a portfolio of 300 hotels, 33% operating margin with a 35% contribution from new business and management fees by FY 2025-26.

When talking about hotels in India, it is impossible not to recognize the Indian Hotels Company (IHCL). IHCL owns Taj, Vivanta and Ginger, all of which are well-known and stylish hotels.

As Covid-19 impacted the hospitality industry, IHCL recorded a loss for fiscal years 2021 and 2022.

However, his company’s performance over these two years does not accurately reflect his position.

The company’s numbers have improved since lockdown restrictions were eased. It reported a net profit of Rs 71.57 crore for the March 2022 quarter, almost 173% higher than the previous year.

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The company also posted its highest ever operating profit margin of 25.3%. Strong demand in the leisure segment as well as a recovery in business travel drove growth.

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Let’s come to the best losers…

#1 Tata Teleservices

First on our list of big losers is Tata Teleservices (Maharashtra) (TTSM).

Shares of the company plunged 49% in 2022 following a much-anticipated correction.

The stock had become Dalal Street’s hottest stock, rising 3,000% in one year and 12,800% in two years, despite no change in its balance sheet or trading outlook.

The title has been on the upper circuit for several days with many rumors circulating on social networks.

The truth is that TTSM is entangled in losses. The company has made profits in only 2 of the past 82 quarters.

Its current liabilities also exceed its current assets. The company is heavily in debt. All of these indicators do not bode well for the company.

When TTSM faced insolvency, Tata Sons provided it with a letter of support. The company has invested heavily in TTSM.

For TTSM, a restructuring approach is being implemented. It is renewed as Tata Tele Business Services (TTBS).

In its latest quarterly result, it reported a net loss of Rs 28 crore which was Rs 28.8 crore in the period a year ago.

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#2 Tata Communications

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Second on our list of Tata Group’s top losers in 2022 is Tata Communication.

The stock price has fallen 40% in 2022 so far.

Higher investment plans, weaker than expected results and a slowdown in order conversion impacted the stock.

The company has increased its capital expenditure plans for fiscal year 2023 from $250 million to $300-325 million.

This should fuel growth while limiting margin expansion in the short to medium term.

It also reported a 2.2% decline in operating income to Rs 16,720 crore for the 2021-22 financial year from Rs 17,100 crore a year ago.

However, the company remains focused on the data business and expects the growth of the data business to accelerate. It intends to grow by double digits over the next two years.

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Here’s how Tata Group shares performed in 2022…

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To conclude…

Tata Group, being one of the most trusted companies in the country, has always been on the watch list of investors and traders.

However, these days the stock market is extremely volatile. Trends are impossible to predict. Companies with strong fundamentals are also suffering.

Even companies with strong finances cannot withstand recession. It is therefore important to exercise due diligence when considering any investment.

Good investment!

Disclaimer: This article is for information only. This is not a stock recommendation and should not be treated as such.

This article is syndicated from Equitymaster.com

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