Automotive giant Tata Motors has unveiled its results for the second quarter. After facing losses last year, the company has now transitioned into profitability. During this quarter, Tata Motors reported a profit of INR 3,764 crores. Comparatively, during the same period last year, the company had incurred a loss of INR 945 crores.
Despite the shift to profitability, the company’s performance was slightly underwhelming when compared to market expectations, which predicted a profit of INR 4,039 crores. These results were announced shortly after the market closure, with the company’s stock closing at a level of 636.8, marking a 1.5% increase.
Detailed Q2 Results:
There has been a noticeable surge in the company’s revenue during this quarter, with an impressive 32% increase from last year, reaching a total of INR 1.05 lakh crores. During the same quarter of the previous year, the revenue was recorded at INR 79,611 crores. In addition, the company’s EBITDA more than doubled year-on-year.
As of the end of September, the EBITDA stood at INR 13,767 crores, a significant increase from the INR 5,572 crores reported a year ago. Margins also saw a robust rise, from 7% the previous year to 13.1% this quarter. Interestingly, the company reported a forex gain of INR 93 crores this quarter, in contrast to a forex loss of INR 624 crores in the previous year.
Performance vs. Market Expectations:
Based on a survey by CNBC TV18, Tata Motors’ performance has been mixed when compared to market anticipations. The profit was 6.8% lower than market projections, whereas the revenue aligned with expectations. The EBITDA performed slightly better, exceeding estimates by around 1%. The anticipated margin was 12.8%, but Tata Motors surpassed it, registering at 13.1%.
JLR (Jaguar Land Rover) Updates:
JLR has witnessed a 30% growth in its revenue year-on-year, reaching 6.9 billion pounds. The EBITDA margin for JLR was reported at 14.9%, which is above the market’s expectation of 14.5%. JLR has also revised its EBIT margin guidance for the financial year 2024, increasing it from 6% to 8%.
The company has expressed optimism regarding production and wholesale volume growth in the next quarter. Furthermore, JLR projects a free cash flow of 2 billion pounds and aims to reduce its net debt to below 1 billion pounds. Tata Motors anticipates that inflationary pressures will remain mild and envisions strong demand in both the commercial and passenger vehicle segments.
