Tata Stocks Brace for Shifts as Donald Trump Begins Second Term
31st Dec 2024
Trump's Policies and Their Impact on Indian Sectors
At this point, investors worldwide are focused on Donald Trump's return to the White House. President-elect Donald Trump and Vice President-elect JD Vance will assume office on Monday, January 20. Trump's aggressive stance on imposing higher tariffs on countries like India and his intent to reassess visa regulations signal that his return as US President could lead to significant changes in the world's largest economy's trade policies.
From a global perspective, Trump's emphasis on 'Make America Great Again' could mean he will extend his first-term agenda of encouraging American companies to boost domestic manufacturing while taking steps to reduce outsourcing. From India's perspective, Trump's policies are expected to significantly impact sectors such as IT, pharma, and commodity-linked sectors such as automobiles.
TCS Braces for H-1B Visa Changes
Two major stocks of the Tata Group- TCS and Tata Motors- could be significantly impacted by Trump's policies as they have a significant presence in the US market. The H-1B visa rules could be important for an IT company like TCS. In his first term, Trump attempted to curb the H-1B visa programme, increasing rejection rates, processing charges, and wage inflation for H-1B resources. However, companies like TCS look better placed as, over the years, it has built local delivery capabilities and hired locals in the US.
Tata Motors' JLR Faces Tariff Challenges
For Tata Motors, high tariffs on US imports could be the key. If Trump follows up on his threat to impose a tariff on all US imports of goods imported from Europe, then JLR exports from Europe to the US could be impacted, hurting Tata Motors. On the other hand, if tariffs are imposed only on imports from China, JLR exports to the US could become more competitive, giving Tata Motors a minor benefit. The increase in costs for competitors' products could benefit JLR, a subsidiary of Tata Motors, which has a significant presence in the North American region, including the US.
At this point, investors worldwide are focused on Donald Trump's return to the White House. President-elect Donald Trump and Vice President-elect JD Vance will assume office on Monday, January 20. Trump's aggressive stance on imposing higher tariffs on countries like India and his intent to reassess visa regulations signal that his return as US President could lead to significant changes in the world's largest economy's trade policies.
From a global perspective, Trump's emphasis on 'Make America Great Again' could mean he will extend his first-term agenda of encouraging American companies to boost domestic manufacturing while taking steps to reduce outsourcing. From India's perspective, Trump's policies are expected to significantly impact sectors such as IT, pharma, and commodity-linked sectors such as automobiles.
TCS Braces for H-1B Visa Changes
Two major stocks of the Tata Group- TCS and Tata Motors- could be significantly impacted by Trump's policies as they have a significant presence in the US market. The H-1B visa rules could be important for an IT company like TCS. In his first term, Trump attempted to curb the H-1B visa programme, increasing rejection rates, processing charges, and wage inflation for H-1B resources. However, companies like TCS look better placed as, over the years, it has built local delivery capabilities and hired locals in the US.
Tata Motors' JLR Faces Tariff Challenges
For Tata Motors, high tariffs on US imports could be the key. If Trump follows up on his threat to impose a tariff on all US imports of goods imported from Europe, then JLR exports from Europe to the US could be impacted, hurting Tata Motors. On the other hand, if tariffs are imposed only on imports from China, JLR exports to the US could become more competitive, giving Tata Motors a minor benefit. The increase in costs for competitors' products could benefit JLR, a subsidiary of Tata Motors, which has a significant presence in the North American region, including the US.