NEW DELHI: The shares of Tata Motors Ltd faced selling pressure in early trade on Monday after its group chief executive officer Carl-Peter Forster resigned with immediate effect, only 18 months after joining the company.
At 11:15 a.m., the company's shares were trading 4.7% lower at Rs 145.70. The stock hit a low of Rs 143.80 in trade today on the BSE.
The company's management clarified that Carl-Peter Forster has resigned due to "unavoidable personal circumstances," but will remain a non-executive member on the Tata Motors board.
Tata Motors Ltd's depository receipts fell by as much as 9.2% on the New York Stock Exchange on Friday. However, for the year it has slipped nearly 50%.
"This is one stock which has not only been underperforming its sectoral peers, but broader markets as well," said Mitesh Thacker of miteshthacker. com.
Investors were already concerned about the slowdown in developed markets, especially Europe, which might put pressure on JLR sales targets. Forster succeeded in turning around JLR since he took charge in February 2010.
Car sales in India fell 10 percent in August on the back of increasing interest rates, higher fuel prices and rising costs.
Last month, Tata Motors posted flat profit in its fiscal first quarter as higher costs and rising interest rates dented margins. The sales of the Nano have also been disappointing and weigh on Tata Motor's profitability in the long run.
At 11:15 a.m., the company's shares were trading 4.7% lower at Rs 145.70. The stock hit a low of Rs 143.80 in trade today on the BSE.
The company's management clarified that Carl-Peter Forster has resigned due to "unavoidable personal circumstances," but will remain a non-executive member on the Tata Motors board.
Tata Motors Ltd's depository receipts fell by as much as 9.2% on the New York Stock Exchange on Friday. However, for the year it has slipped nearly 50%.
"This is one stock which has not only been underperforming its sectoral peers, but broader markets as well," said Mitesh Thacker of miteshthacker. com.
Investors were already concerned about the slowdown in developed markets, especially Europe, which might put pressure on JLR sales targets. Forster succeeded in turning around JLR since he took charge in February 2010.
Car sales in India fell 10 percent in August on the back of increasing interest rates, higher fuel prices and rising costs.
Last month, Tata Motors posted flat profit in its fiscal first quarter as higher costs and rising interest rates dented margins. The sales of the Nano have also been disappointing and weigh on Tata Motor's profitability in the long run.
ROHIT KALIA
PGDM 3RD SEM
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