Tata Motors Q3 profit spikes 138% to ₹7,025.11 cr

Tata Motors Ltd has reported a 137.5% rise in consolidated net profit during October-December 2023-24 at ₹7,025.11 crore against ₹2,958 crore in the year-ago period, driven by a solid performance by the passenger vehicle arm and Jaguar Land Rover.

The company's consolidated revenue rose 25% to ₹1.11 lakh crore against ₹88,489 crore in the same period last year, Tata Motors' exchange filing shows.

The company's EBITDA for the said quarter stood at ₹15,800 crore, up 60.6%. In its outlook, Tata Motors says it remains positive on all three auto businesses. "We expect the performance to further improve in Q4 on account of seasonality, new launches and improving supplies at JLR.”

PB Balaji, group chief financial officer, Tata Motors says the company aims to end the year on a “strong footing”.

Among its three auto businesses, Tata Passenger Vehicles (TATA PV) recorded a surge in revenues at 10.6% YoY at ₹12,900 crore. EBIT margins improved by 60 bps YoY to 2.1% on account of cost savings in commodities, offsetting higher fixed-expense spending.

The company's EV penetration at 12%, and CNG penetration at 14% in YTD FY24.

Looking ahead, the company says, it sees “healthy growth for business with multiple new products scheduled for launch in CY2024”.

Shailesh Chandra, MD, Tata Motors PV says: “The business continued to improve financial performance and EV business (excluding R&D spends) was EBITDA breakeven. Going forward, we will remain agile and are optimistic about continuing the growth trend in the quarters ahead.”

JLR's revenue for the quarter came in at £7.4 billion, up 22% versus Q3 FY23 and up 8% versus Q2 FY24. The company “delivered its best quarterly profit for seven years and highest ever revenue for the first nine months of a financial year”, says Adrian Mardell, JLR chief executive officer. EBIT margin was positive at 8.8%, more than doubling from 3.7% a year ago.

Looking ahead, JLR is on track to achieve "its profitability and cashflow targets. The EBIT margin for FY24 is expected to be over 8%. “We continue to expect operating cash flow to support net debt of less than £1 billion by the end of FY24 and positive net cash in FY25".

Tata Motors' commercial vehicles arm’s (Tata CV) domestic wholesale CV volumes were 91,900 units, marginally up at 1.1% YoY. However, revenues improved 19.2% YoY to ₹20,100 crore on account of salience towards medium and heavy commercial vehicles and better market operating prices.

Looking ahead, the CV unit expects demand to improve in Q4FY24 on the government’s thrust on infra development, promising growth outlook of the economy and its demand-pull initiatives.

Girish Wagh, executive director of Tata Motors Ltd, says the CV industry witnessed a pause in sales growth in Q3FY24 on account of the higher base effect, the impact of elections held across five states, and the post-festive seasonal slowdown in rural consumption.