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As on 01-Aug-2024  17:49

Tata Motors Q1 PAT climbs 74% YoY to Rs 5,555 crore

The company's profit before tax stood at Rs 8,828 crore in first quarter of FY25, up 59.32% YoY from Rs 5,541 crore posted in corresponding quarter last year.

EBITDA for the quarter climbed 6.04% to Rs 15,568 crore as against Rs 14,681 crore posted in same quarter last year. EBITDA margin stood at 14.4% in June 2024 quarter. EBIT margin increased 30 bps YoY to 8.4%.

In its outlook, the auto major stated global demand is likely to remain muted and it expects gradual improvement in domestic demand during the rest of the year on account of continued investments in infrastructure, healthy monsoons, favourable macros and festive demand. Commodities are likely to remain range bound.

PB Balaji, group chief financial officer of Tata Motors said: 'The first quarter has carried forward the momentum of last year with all businesses continuing to deliver on their distinctive strategies. We are confident of sustaining the performance in the coming quarters and delivering a strong year.'

JLR reported a net profit of 502 million pounds in Q1 FY25 as against a net profit of 323 million pounds recorded in Q41FY24. Revenue increased 5.36% YoY to 7,273 million pounds in the quarter ended 30 June 2024.

The positive momentum in JLR's financial performance continued in Q1 FY25, driven by higher wholesale volumes, investment in demand generation and a favourable pricing environment. The higher profitability YoY reflects favourable volume, mix and material cost improvements, offset partially by increased marketing spend compared to a year ago

Free cash flow (FCF) stood at 230 million pounds in the quarter ended June 2024.

Total liquidity was at 5.3 billion pound including the 1.5 billion pound undrawn revolving credit facility maturing 1 April 2026.

Looking ahead, the company is likely to witness constrained production in Q2 and Q3 reflecting the annual summer plant shutdown and floods at a key aluminum supplier. As we work towards mitigation and recovery, we will hold our guidance on our key full year financial deliverables of more than 8.5% EBIT and achieving net cash.

Tata Commercial Vehicles (Tata CV) recorded a profit before tax of Rs 1,535 crore in Q1 FY25, up 63.82% from Rs 937 crore reported in Q1 FY24. Revenue from operations during the quarter rose 5.1% YoY to Rs 17,849 crore on account of better realizations and cost saving while M&HCV segment led the growth.

In its outlook, Tata CV said that the forecast of a healthy monsoon, expectations of policy continuity and continuing thrust on infra related developmental projects by the Government are expected to improve the demand for commercial vehicles. The demand in staff, intercity, and stage carriage segments should also remain healthy despite the seasonal dip often seen in school transportation in Q2 FY25. The business will continue to focus on strong EBITDA delivery, higher ROCE and unlocking value through downstream businesses.

Girish Wagh, executive director of Tata Motors, said, 'Q1 FY25 registered a positive start for the Indian commercial vehicles sector. Tata Motors recorded commercial vehicles domestic sales of 87,615 units, ~7% higher than Q1 FY24 sales. Overall positive market sentiment arising from increased economic activity, continuing infrastructure development, and growing demand of e-commerce, auto aggregates and LPG segments led to sales improving across most segments ' HCV, MCV and CV Passenger. The business delivered strong EBITDA margins of 11.6% in Q1 FY25.'

Tata Passenger Vehicles (TATA PV) recorded revenue of Rs 11,847 crore (down 7.7% YoY). It reported a profit before tax of Rs 173 crore in Q1 FY25, down 7% as compared to the same period a year ago.

The auto maker said that PV volumes were at 138.8K units (down 1.1% YoY) as the company readjusted its wholesales in line with retails to keep channel inventory under control. Q1 FY25 EV volumes stood at 16.6K units (down 13.9% YoY), due to sharp decline in fleet segment.

On Outlook front, TaMo said, 'Although demand has remained less than anticipated, we expect it to pick-up during festive period. New product launches will augur well for the business. Our focus is to increase addressable market by introducing new nameplates, strengthen multipowertrain strategy to leverage industry powertrain shifts and proactively grow the EV market in India while maintaining market leadership. We will work towards enhancing profitability through scale benefits, improving mix and optimization of cost & capex.'

Shailesh Chandra, managing director, Tata Motors Passenger Vehicles & Tata Passenger Electric Mobility, said, 'The Passenger Vehicle industry in Q1 FY25 witnessed retails (registrations) moderating, impacted by the general elections and intense heat waves across the country. Tata Motors sales of 138,682 cars and SUVs was slightly lower compared to Q1 FY24, as we proactively readjusted our wholesales in line with retails to keep channel inventory under control. Our multi-powertrain strategy and strong portfolio of SUVs led to steady sales.'

Finance costs reduced by Rs 527 crore to Rs 2,088 crore during Q1 FY25, on account of reduction in gross debt.

For Q1 FY25, net profit from joint ventures and associates amounted to Rs 129 crore compared to Rs 211 crore in Q1 FY24. Other income (excluding grants) was Rs 833 crore in Q1 FY25 versus Rs 677 crore in Q1 FY24.

Free cash flow (automotive) for the quarter, was positive at Rs 1.2K crore driven by strong improvement in cash profits, partially offset due to seasonality. Net automotive debt was at Rs 18.6K crore.

Meanwhile, the car maker's board has approved a composite scheme of arrangement amongst Tata Motors (TML), TML Commercial Vehicles (TMLCV), Tata Motors Passenger Vehicles (TMPV). As a part of the scheme, TML will demerge its CV undertaking involving the CV business and all its related investments into TMLCV. Further, the existing PV business in TMPV, will be merged into TML, the existing listed entity.

Upon the scheme becoming effective, both TMLCV and TML will be renamed, resulting in two separate listed entities: The Commercial Vehicle business and its related investments, under the name TML, and The Passenger Vehicle business, the Electric Vehicle (TPEM) business, JLR and their related investments, under the name TMPV.

Pursuant to the scheme, shareholders of TML will receive 1 share of TMLCV of face value Rs 2 for every 1 share of Rs 2 held in TML of the same class. The scheme is subject to all the necessary shareholder, creditor and regulatory approvals which can take around 12-15 months to complete stated TML.

Tata Motors, part of the Tata group, is a global automobile manufacturer of cars, utility vehicles, pick-ups, trucks and buses.

Shares of Tata Motors ended 1.02% lower at Rs 1,44.60 on the BSE.

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