Why Tata Motors Share Is Falling in 2025 | Price and Outlook

Find out why Tata Motors share is falling in 2025. Complete breakdown of the price drop, JLR outlook, DVR share price, analyst views & future recovery scope.

Tata Motors shares are falling in 2025 due to JLR’s softened profit projections, increased EV transition costs, and global tariff pressure. The share price of tata motors has corrected over 40% from its 52-week high. This unexpected dip is causing concern among investors, and we have seen a flood of queries along the lines of “Why tata motors share is falling?” and “Will it recover soon?” 

In this blog post, we will touch on all the important reasons for the current fall, including considering the Tata Motors DVR share price, in addition to what shareholders could anticipate going forward.

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What Triggered the Decline in Tata Motors Share Price?

On June 16, 2025, Tata Motors’ stock fell over 5% intraday following the company’s subsidiary Jaguar Land Rover’s (JLR) underwhelming FY26 financial outlook. The revelation was the result of:

• A reduction in JLR’s margin forecast of 5-7% (from approximately 10%)
• A flat free cash flow forecast
• Worries surrounding electric vehicle (EV) transition costs
• Effects of the U.S. tariff on exports of luxury vehicles

The share price tata motors traded off heavily as analysts were forced to move down expectations. Concerns about its global operations have now entered into its domestic sentiment as well.

Tata Motors Share Price in 2025: Current Status

As of mid-June 2025:

• Share price tata motors is currently trading near ₹675, down from a 52-week high of ₹1,179.
• This decline equates to a greater than 40% correction from its highs.
• This considerable decline is a clear reason why people are continually searching “why tata motors share is falling” across platforms.{1}

The consolidated financials of the company is heavily reliant on JLR, which contributes almost 75-80% of overall profits.

JLR’s Weak FY26 Outlook – The Main Trigger

JLR’s management indicated that free cash flow would be almost zero in FY26. The EBIT margin is forecasted to contract to 5–7%, which is significantly lower than investors are expecting.

This update spooked investors for 3 reasons:

1. Profitability contraction affects total consolidated results.
2. Cash flow pressure might impact new EV platform investments.
3. Raises questions over global luxury demand and JLR’s pricing power.

Tariffs and Trade Tensions Add Fuel to Fire

Previously; however, it is important to point out that the 25% U.S. tariff on EV imports from the U.K. is a massive global pressure point and directly impacts JLR exports.{2}

While there is a stop-gap deal for 100,000 units with a lower, 10% tariff, clearly this does not help soften the long-term cost impact. The higher tariffs are a substantial margin reduction, primarily because JLR is a luxury brand competing against Tesla, BMW, and Mercedes for EV sales.

Rising EV Transition Costs

JLR and Tata Motors are investing a lot of money in electrification:

• There is JLR’s “Reimagine” strategy, envisioning a fully electric line-up in 2030.
• Tata Motors in India is building out its EV portfolio with Nexon EV, Punch EV, and Curvv EV, scheduled to launch soon.

While moving toward the future, they require significant CapEx today that alters the balance sheet.

Domestic Market Weakness Adds to Worry

While international developments take the news spotlight, Tata Motors’ domestic sales have been slightly weaker:{3}

• Passenger vehicle sales fell 4.2% in April 2025
• It runs into competition from Mahindra, Hyundai, and Maruti Suzuki entering the ICE and EV space

All of this concerns investors and says much about why tata motors share is falling even in the Indian market.

Tata Motors DVR Share Price – A Parallel Trend

The Tata Motors DVR share price (Differential Voting Rights) is usually at a discount to ordinary shares. As of June 2025: 

• DVR shares at ₹768 
• Down approximately 4.9% from its 52-week high 

Investors usually go for DVR shares for the better yield, but ordinary shares decline is dragging down the DVRs as well.

Historical Share Price Trends

Tata Motors Share Price Trend (2021–2025)

Let’s quickly consider share price tata motors movement over the past five years and the underlying catalyst’s:

• 2021: ₹290 – ₹525

The pandemic facilitated momentum around electric vehicles, contributing to Tata Motors’ recovery and consistent growth.

• 2022: ₹400 – ₹610

The market excitement regarding the Nexon EV, particularly the vehicle’s success during 2022, helped build investor confidence in the stock and trade the stock into higher valuation territory.

• 2023: ₹550 – ₹800

 Jaguar Land Rover produced profitable results giving a substantial boost to Tata Motors performance during the period.

• 2024: ₹700 – ₹1179

Ev- hype and expansion plans led to the stock hitting an all-time high. This was indeed the peak for bullish sentiment. 

• 2025: ₹675 (current)

Following JLR ‘s announcement of having a weaker FY26 outlook, a sharp correction in the stock followed. Over a 40% loss from the previous high was recorded.

What Analysts Are Saying

The top analysts from Motilal Oswal and ICICI Securities have commented:

• “The margin downgrade from JLR is a reset of investor expectations. The near-term pressure is true but the long-term fundamentals are rinse/wash/repeat.”
• “FY26 could be muted but FY27–28 could be a much better picture, if EV strategy execution goes to plan.”{4}

These observations maintain that while short-term pessimism seems warranted, the medium-to-long-term investment case may still have merit.

Can Tata Motors Share Recover?

• Yes, but it varies based on the following:
• If JLR can realign itself to profitability by cutting costs
• Global tariff conditions
• Indigenous adoption and demand for EV
• CapEx discipline and Free Cash flow generation

Most likely it will be a slow recovery aligned to global EV sentiment and economic conditions.

Final Take

The simple reason why tata motors share is falling is because investors are recalibrating for weak JLR financial guidance, costs related to upgrading to EV, and global trade issues. The share price of Tata motors has already corrected downward to factor in current expectations. 

Though it seems distressing in the short term, as a leader in the EV space in India and with an aggressive remake agenda globally, long term investors can suggest getting prepared for activity while looking for signs of JLR margin improvement and improving domestic sales.

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