Tata Motors shares fell over 3% to Rs 419.70 on the BSE in intra-day trade on Thursday after Jaguar Land Rover (JLR) CEO Thierry Bollore announced his resignation from the company on Wednesday due to personal reasons. He will serve his last day on December 31, 2022.

“Thierry Bolloré has resigned as a non-executive non-independent director of Tata Motors following the conclusion of the Jaguar above Land Rover (JLR) with effect from December 31, 2022, the company said in a regulatory exchange filing”. The company has appointed Adrian Mardell (acting CFO), a 32-year veteran, as interim CEO.

Bolloré has been with the company for over two years, succeeding long-time JLR CEO Sir Ralf Speth. He has worked for companies such as Michelin and Renault.

Tata Motors recovered almost half of its intraday losses at 11:51 am on the BSE, with shares down 1.7% at Rs 424.10. In contrast, the S&P BSE Sensex fell 0.18% to 61,866.

Meanwhile, Tata Motors has underperformed over the past three months, falling 13%, while the Sensex gained 2.7%. Moreover, the stock has fallen 20% over the past year, while the benchmark index has gained 3%.

Tata Motors’ September quarter results for the 2022-23 fiscal year (Q2FY23) missed Wall Street expectations, making analysts cautious about the pace of recovery ahead as supply conditions ease and commodity prices start to retreat.

ICICI Securities analysts have downgraded the stock to hold from buy with a target price of Rs 465 per share on weak FY23 volume, EBIT margin and free cash flow guidance for JLR, healthy growth in domestic business. The primary levers are already in place (CV, PV and EV space).

However, Emkay Global said Jaguar Land Rover had a strong order book of around 205,000 units, with models such as the new-generation RR/RR Sport and Defender accounting for more than 70% of orders, which should lead to an improved mix of products going forward.

“JLR is expected to ramp up production at a slower pace than previously expected in H2FY3 due to supply constraints,” analysts at Emkay Global Financial Services said in their Q2FY23 results update.

The brokerage expects sales upcycle across segments, aggressive cost savings and debt reduction. “We reiterate our Buy rating on the stock with a target price of Rs 490 on SOTP (previously Rs 515), based on December 24 estimates (early September 24),” the analyst said.

Analysts at Prabhudas Lilladher also believe that the company may benefit from a cyclical upturn in commercial vehicle sales (14.2% vs 6.9% in FY19) due to improving product mix, customer preference for SUVs and rising penetration of EVs. We’ll see a likely increase in market share in PV, improved fleet utilisation and freight rates, a revival of Jaguar Land Rover, and firm orders to benefit and drive FCF generation. The brokerage has a “buy” call on Tata Motors with a target price of Rs 520 per share.