Tata Motors is also the second least expensive stock in the benchmark index, based on 12-month forward earnings, after new entrant Sesa Sterlite, despite outperforming Sensex by a wide margin in 2013.
Tata Motors rose 15.3 percent in 2013 compared to the BSE index return of 7.72 percent in the same period, as of Thursday's close.
Tata Motors is trading at 8.38 times its 12-month forward earnings, just slightly higher than the 8.24 times for Sesa Sterlite, which is currently the cheapest stock in the Sensex, Thomson Reuters data shows.
However, some point out its better to value Tata Motors on enterprise value/operating profit or sum-of-the-parts method given losses in domestic business, forex fluctuations and tax treatment by the company.
Tata Motors shares were up 2 percent on value buying after falling 8.4 percent over the previous three sessions on worries about higher than expected capex at unit JLR.