Tata Motors, Bharat Forge in Focus on US Trade Deal Boost

Introduction to Market Drivers

Investors are closely monitoring several key developments ahead of the market opening on February 9, 2026. The primary catalyst is the newly announced India-US interim trade agreement, which is set to significantly lower tariffs on Indian goods from 50% to 18%. This policy shift is expected to provide a substantial tailwind for Indian exporters, particularly within the automotive and auto-ancillary sectors that have significant exposure to the North American market. Alongside this macroeconomic development, a host of corporate earnings reports and company-specific news from firms like IDBI Bank, Kalyan Jewellers, and Aurobindo Pharma will drive stock-specific movements.

Auto Sector Gains on Tariff Reduction

The trade agreement is poised to reshape the competitive landscape for Indian auto component suppliers and vehicle manufacturers. By reducing the cost burden of exports, the deal enhances the pricing power and demand visibility for companies with a strong US presence. Several firms are positioned to benefit directly from this development, making them key stocks to watch.

Tata Motors: The company's luxury arm, Jaguar Land Rover (JLR), is heavily reliant on the US market, which accounts for 33% of its total volumes and contributed 86% of Tata Motors’ passenger vehicle revenue in the last fiscal year. Lower trade barriers are expected to support JLR's pricing strategy and strengthen its order book.

Bharat Forge: With approximately 38% of its revenue originating from North America, Bharat Forge stands to gain significantly. The company supplies critical forgings and auto parts to US clients, and reduced tariffs will improve its cost competitiveness against global peers.

Sona BLW Precision Forgings: As one of the most directly exposed auto-ancillary players, Sona BLW derives over 40% of its revenue from the United States. The tariff reduction is a direct positive for its export operations.

Other Beneficiaries: Samvardhan Motherson, with 18-20% of its revenue from North America, and Balkrishna Industries, with 17% US revenue exposure, are also expected to see improved market access and a healthier order pipeline. In contrast, Eicher Motors, with only about 2% of its Royal Enfield volumes coming from the US, is likely to experience a limited impact from the deal.

Corporate Actions and Regulatory Updates

Beyond the trade deal, several companies are in the news for strategic and regulatory reasons. The government's privatisation agenda for IDBI Bank has advanced, with the Department of Investment and Public Asset Management (DIPAM) confirming the receipt of financial bids. While the bidders' names were not officially disclosed, market sources suggest Kotak Mahindra Bank and Fairfax India Holdings are leading contenders.

In the M&A space, Force Motors announced a Memorandum of Understanding to acquire 100% of Veera Tanneries Private Ltd for ₹175 crore, pending due diligence. Meanwhile, Power Finance Corporation (PFC) received board approval to acquire the government's 52.63% stake in Rural Electrification Corporation (REC), positioning REC as a subsidiary of PFC.

On the regulatory front, Aurobindo Pharma announced that the US Food and Drug Administration (US FDA) completed an inspection of its subsidiary Eugia Pharma Specialities' Unit-III facility in Telangana. Separately, PB Fintech issued a clarification denying recent media reports that it was considering raising funds through a Qualified Institutional Placement (QIP).

Q3 Earnings Season in Full Swing

The third-quarter earnings season continues to influence market sentiment, with a mixed bag of results from various sectors.

Strong Performers:

• Kalyan Jewellers delivered a standout performance, with its net profit surging 90% year-on-year to ₹416.2 crore. Revenue grew a robust 42% to ₹10,343 crore.
• Tata Steel reported a sharp rise in consolidated net profit to ₹2,730 crore, a significant improvement from ₹295 crore in the same quarter last year, driven by strong volume growth.
• Bosch saw its net profit increase by 16.1% to ₹532 crore, with revenue from operations climbing 9.4% to ₹4,885.6 crore.
• Shree Cement posted a 37.9% year-on-year rise in net profit to ₹266.7 crore on the back of a 5% revenue growth to ₹4,800 crore.

Companies with Weaker Results:

• Sun TV Network reported a 10.7% decline in net profit to ₹324 crore, despite a 4% increase in revenue.
• Whirlpool India's net profit fell by 39.8% to ₹26.5 crore, though its revenue saw a modest 4% rise.
• Jana Small Finance Bank experienced a steep 91.2% plunge in net profit to ₹9.7 crore.
• Sula Vineyards continued its weak performance, reporting a sharp decline in net profit for the fifth consecutive quarter, attributing it to destocking in Karnataka.

Investment and Expansion Plans

Several companies announced significant capital expenditure plans, signaling confidence in future growth. Mitsubishi Electric inaugurated a new air-conditioner and compressor manufacturing facility near Chennai, developed with an investment of ₹2,100 crore. Tata Chemicals also announced an investment of ₹515 crore to establish a new greenfield manufacturing plant in Tamil Nadu for iodised vacuum salt dried products.

Market Outlook

As the trading session begins, the market is expected to react positively to the India-US trade deal, with auto and ancillary stocks likely leading the gains. However, stock-specific performance will be heavily influenced by the ongoing earnings announcements and other corporate developments. Investors will be weighing the macroeconomic tailwinds against individual company fundamentals to navigate the market effectively.