Net profit of Tata Motors fell 11% year-on-year to ₹3,343 crore for the quarter ended September compared with ₹3,764 crore in the corresponding period last year, dragged down by a challenging external environment.
Revenue from operations fell 3.5% year-on-year to ₹1.01 lakh crore during the second quarter.
Earnings before interest, taxes, depreciation, and amortisation (EBITDA) stood at ₹11,600 crore or 11.4%, down 230 basis points.
Profitability in JLR was affected by temporary aluminium supply constraints which resulted in EBIT margins of 5.1%, down 220 basis points.
Luxury unit JLR’s revenue was down by 5.6% to 6.5 billion pounds. JLR held its full year guidance for revenue of £30 billion, EBIT margin of 8.5% and achieving a positive net cash position.
Commercial vehicle revenues were down by 13.9% but EBITDA margins improved to 10.8% (up 40 bps) on favourable pricing and material cost savings despite adverse volumes. Passenger vehicle revenues were down by 3.9% but EBITDA margins were steady at 6.2% (down 30 bps) through mix improvements and cost reduction actions.
“We remain cautious on near-term domestic demand. However, the festive season and substantial investments in infrastructure should help bolster it. JLR wholesales are expected to improve sharply, as supply challenges ease. Overall, we expect an all-round improvement in performance in H2 FY25 and the business to become net debt free by this year,” the automaker says in a statement.
“Growth in the quarter was impacted due to significant external challenges as highlighted earlier. Overall, the business fundamentals remain strong, and we remain focused on our agenda of driving growth, competitiveness and free cash flows. As the supply challenges ease and demand picks up, we are confident of steady improvement in our performance and delivering a strong H2,” says PB Balaji, group chief financial officer, Tata Motors.
JLR delivered an eighth successive profitable quarter, despite temporary aluminum supply constraints.
“JLR has delivered a resilient performance in Q2, resulting in a 25 per cent increase in first half profits year-on-year. Our teams responded brilliantly to the aluminum supply shortages we experienced in the quarter, so we could deliver as many orders as possible to clients. We continue to make good progress delivering our Reimagine strategy. We have invested £250m so far to prepare our Halewood UK plant for electric vehicle production and with strong global demand for our products, we are well positioned to deliver on our commitments again this financial year,” says Adrian Mardell, JLR Chief Executive Officer.
