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Informist, Friday, Aug. 8, 2025

 

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--Tata Motors Apr-Jun consol PAT INR 39.24 bln vs INR 56.43 bln year ago
--Analysts saw Tata Motors Apr-Jun consol net profit at INR 33.31 bln
--Tata Motors Apr-Jun consol revenue INR 1.044 tln vs INR 1.071 tln year ago
--Tata Motors Apr-Jun consol EBITDA margin 9.2%, down 480 bps on year
--Tata Motors Apr-Jun consol EBITDA INR 97 bln, down 35.8% on year
--Tata Motors Apr-Jun consol EBIT margin 4.3%, down 370 bps on year
--Tata Motors Apr-Jun Tata CV revenue INR 170.09 bln, down 4.7% on year
--Tata Motors Apr-Jun Tata CV EBITDA margin 12.2%, up 60 bps on year
--Tata Motors Apr-Jun Tata CV EBIT margin 9.7%, up 80 bps on year
--Tata Motors Apr-Jun JLR revenue 6.60 bln pound sterling, dn 9.2% on year
--Tata Motors Apr-Jun JLR EBITDA margin 9.3%, dn 650 bps on year
--Tata Motors Apr-Jun JLR EBIT margin 4.0%, dn 490 bps on year
--Tata Motors Apr-Jun Tata PV revenue INR 108.77 bln, dn 8.2% on year
--Tata Motors Apr-Jun Tata PV EBITDA margin 4.0%, dn 180 bps on year
--Tata Motors Apr-Jun Tata PV EBIT margin (-)2.8%, dn 310 bps on year
--Tata Motors retains JLR FY26 margin guidance of 5-7%
--Tata Motors: US tariffs had direct, material impact on JLR profitability
--Tata Motors: NCLT reserved order on demerger after final hearing on Friday
--Tata Motors:US-UK trade deal will sharply reduce fincl impact of US tariffs
--Tata Motors: Aim to complete demeger in Jul-Sept with Oct 1 effective date
--Tata Motors: Overall PV inudstry's growth seen muted
--Tata Motors: Focus is on delivering strong performance in Oct-Mar
--Tata Motors: Full impact of Harrier.ev retails expected from August
--Tata Motors: Stress in volumes more pronounced in cars below INR 1 mln
--Tata Motors Q1 consol PAT from continuing ops INR 39.2 bln vs INR 56.4 bln
--CONTEXT:Tata Motors Q1 PAT from continuing ops excludes Tata Motors Finance

 

By Avishek Rakshit and Sunil Raghu

 

KOLKATA/AHMEDABAD – Tata Motors Ltd. Friday reported muted performance for the June quarter as sales volume declined across all business segments on account of softness in demand and profitability from its Jaguar Land Rover division dropped owing to the tariffs imposed in the US by the Donald Trump administration. Even so, the company's consolidated net profit and revenue surpassed the Street's expectations by a wide margin.

 

Tata Motors reported a 30.5% on-year fall in consolidated net profit from continuing operations at INR 39.24 billion during the June quarter against the Street's expectation of INR 33.31 billion. Its consolidated revenue fell 2.5% on year to a little over INR 1.00 trillion, against the Street's estimate of INR 895.10 billion.

 

In a statement, Tata Motors said its consolidated earnings before interest, tax, depreciation, and amortisation declined 35.8% on year to INR 97.00 billion and the EBITDA margin declined 480 basis points on year to 9.2%. The consolidated EBIT margin fell 370 bps on year to 4.3%.

 

Revenue from Jaguar Land Rover during the June quarter was down 9.2% on year at 6.60 billion pound sterling while the EBIT margin from this division, hit by the imposition of tariffs in the US, declined 490 bps to 4%.

 

Sales of commercial vehicles were down 4.7% on year at INR 170.10 billion, but the EBITDA margin from this segment improved 60 bps on year to 12.2%, benefiting from better realisations and cost savings.

 

Revenue from passenger car sales declined 8.2% on year to INR 108.77 billon on account of muted demand and consumers transitioning to newer models. As a result, the EBITDA margin from passenger cars declined 180 bps to 4%.

 

In a note to its accounts for the June quarter, Tata Motors said the amalgamation of Tata Motors Finance Ltd., a wholly-owned step-down subsidiary of the company, into Tata Capital Ltd. was approved by the National Company Law Tribunal with the appointed date being Apr. 1, 2024. Based on the order, the company accounted for the transfer of net assets in accordance with the accounting principles generally accepted in India and has recognised the excess of consideration received in the form of equity shares of Tata Capital amounting to INR 80.20 billion over the book value of net assets transferred as on the appointed date amounting to INR 49.80 billion as gain on sale of discontinued operation in consolidated results.

 

JLR's TARIFF WOES

In the Jaguar Land Rover division, which accounts for over 70% of the company's revenue and around 74% of its pre-tax profits, wholesale volumes and revenue in the June quarter were impacted by the application of 27.5% tariffs on UK- and EU-produced cars exported to the US. The planned winding down of legacy Jaguar vehicles ahead of the launch of new models also hit sales. US trade tariffs also had a direct and material impact on profitability and cash flow in the June quarter.

 

Tata Motors said that on Apr. 3, an incremental 25% tariff was imposed on imports of vehicles and parts into the US from the UK, which resulted in an incremental cost of INR 29 billion in the company's consolidated results for the June quarter. On May 8, the Trump administration introduced a provision allowing for the first 100,000 UK-manufactured vehicles imported annually into the US to be subjected to a reduced total tariff of 10%. With the announcement of the US-EU trade deal in Jul. 27, vehicles produced in the EU and exported to the US are expected to face a reduced tariff of 15% from the current 27.5% in due course.

 

In the commercial vehicles segment, which accounts for over 16% of the company's sales and around 19% of the pre-tax profit, the June quarter started on a subdued note as demand for heavy commercial vehicles and small commercial vehicle and pickup segments was muted. Buses, vans, and intermediate and light-medium commercial vehicles registered modest on-year growth, the company said in its statement. Domestic volumes of commercial vehicles were down 9% on year while exports were up 68%.

 

The passenger cars division, which accounts for the remaining 14% of top line and over 5% of the pre-tax profit, experienced volume pressures in the June quarter, particularly in May and June, with flat growth reflecting continued softness in demand.

 

This segment's wholesale volumes in the June quarter declined over 10% on year to 124,800 units on account of the overall decline in demand in the automotive industry and transitions to newer models of the Altroz, Harrier, and Safari. Profitability in the passenger car segment was affected by adverse volumes, lower realisations, and the impact of leverage, but these factors were offset in part by the company's continued drive for savings in variable costs.

 

DEMERGER SCHEME

Tata Motors aims to complete the demerger of its commercial and passenger vehicle businesses in Jul-Sept., with Oct. 1 as the effective date. The company is hopeful of accomplishing this with the National Company Law Tribunal concluding the hearing Friday. The tribunal has reserved its order in the matter.

 

Apart from the demerger, the company expects to complete the proposed 100?quisition of Iveco Group N.V., announced Jul. 30. Tata Motors has sought to buy the Italian company, excluding its defence operations, through a voluntary tender offer to all public shareholders. The deal is valued at 3.8 billion euros and is subject to regulatory approvals. Tata Motors expects to close the deal in the first half of 2026.

 

Looking ahead, Tata Motors said it expects the demand environment to remain challenging. As for a plan to counter the impact of US tariffs and the resultant margin pressures, the company said it would leverage its brand strength, improve the product mix, and undertake targeted measures to improve margins.

 

Friday, shares of Tata Motors ended 2% lower at INR 633.70 on the National Stock Exchange. The company detailed its financial results for the June quarter after market hours.  End

 

Edited by Rajeev Pai

 

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