The Automotive Research Association of India (ARAI) has awarded Tata Motors (BO:TAMO) (NYSE:TTM) Ltd the first-ever Auto Production Linked Incentive (PLI) certificate in the N1 category for its all-electric Ace EV. The award is in accordance with the PLI scheme's objective to stimulate local manufacturing and automotive exports from India.
Tata Motors earned this distinction after securing a pivotal domestic value certificate, qualifying for the substantial Rs 25,938 crore ($3.5 billion) PLI scheme. The Indian Government extended this initiative until FY 2027-28 on August 30, 2023, providing incentives for specific sales of Advanced Automotive Technology (AAT) products manufactured in India since April 1, 2022.
The PLI scheme, launched in 2021, has seen over 115 automobile and ancillary firms apply. It aims to boost local production of AAT products, address cost disabilities, create jobs, and build a robust supply chain. The Cabinet approved an incentive plan of Rs. 26,000 crore ($3.5 billion) for the auto sector, initially planned for a five-year period but later extended until FY 2027-28, benefiting all eligible Original Equipment Manufacturers (OEMs).
InvestingPro Insights
In light of the recent Auto Production Linked Incentive (PLI) certificate awarded to Tata Motors Ltd, it's worth noting a few InvestingPro Tips and data points. Firstly, Tata Motors has been experiencing accelerating revenue growth. This is a positive indicator for investors, especially considering the company's new incentive to increase local manufacturing and exports.
Secondly, net income is expected to grow this year, another encouraging sign for potential investors. This aligns with analysts' predictions that the company will be profitable this year, a fact underscored by its profitability over the last twelve months.
Lastly, the stock has seen a substantial price uptick over the last six months. While the stock's price movements can be quite volatile, it's currently trading near its 52-week high, suggesting a strong return over the last five years.
These are just three of the many insights available on InvestingPro. For a complete list of tips and real-time data, consider subscribing to InvestingPro and gain access to their comprehensive database.
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