Analyst Concall
Discounts up QoQ in some PV segments Q1, says Tata Motors
This story was originally published at 23:20 IST on 8 August 2025
Register to read our real-time news.Informist, Friday, Aug. 8, 2025
Please click here to read all liners published on this story
--Tata Motors: Volume, mix hit co's Apr-Jun consol revenue
--CONTEXT: Comments by Tata Motors mgmt in post-earnings investor call
--Tata Motors: US tariffs hit JLR EBIT in Apr-Jun
--Tata Motors: Sticking to FY26 EBIT growth guidance of 5-7% for JLR
--Tata Motors: HCV volume down Q1 due to regional demand shifts, early rains
--Tata Motors: PV EBIT margin hit in Q1 on account of adverse volume
--Tata Motors: Transitions for 3 new model launches Q1-end affected volumes
--Tata Motors: Global demand likely to be challenging, confusing near-term
--Tata Motors: Apr-Jun discounts in some segments up marginally QoQ
--Tata Motors: Buses, vans growth in Q2, Q3 depends on tenders from govt
--Tata Motors: PV segment below INR 1 mln to continue to see discounting
--Tata Motors: Q1 was challenging quarter, particularly on JLR side
By Rajesh Gajra
NEW DELHI – The stress in the below INR 1 million passenger vehicle segment in the domestic industry, which the market has "been seeing for a while", continued in the June quarter, and got more pronounced, the senior management of Tata Motors Ltd. said in a post-earnings call with investors and analysts Friday. This led to lower-than-expected retail volumes during the quarter in the industry and resulted in an "environment of sustained high levels of discounting," according to the management.
Tata Motors had to, therefore, counter the competition discounts in certain segments of passenger vehicles where it increased discounts by not more than 50 basis points on a quarter-on-quarter basis in the June quarter, the management said. The weak demand led to Tata Motors moderating wholesales in its passenger and electric vehicles segment for the June quarter "to ensure controlled channel inventory growth," according to the earnings investor presentation.
Discounting in the below-INR-1-million passenger vehicle segment in the industry will likely continue going ahead, Tata Motors' top executive said in the investor call.
The company's volume and profitability in the passenger and electric vehicles segment for the June quarter was also affected by transitions for new models for Altroz, Harrier, and Safari at the end of quarter, the management said. The transition effect involves ramp down of volumes of earlier models for a certain period prior to the scale-up of the new ones.
The earnings before interest and tax margin in the passenger vehicle segment contracted by 310 basis points to (-)2.8% in the June quarter on account of adverse volume and realisations, according to management. At a consolidated level, too, adverse volume and product mix hit the company's total revenue, the management said. The consolidated revenue of Tata Motors fell 2.5% on year and 13% on quarter to INR 1.037 trillion in the June quarter.
The management said the June quarter was a challenging quarter for the company "on multiple fronts" but "particularly on the JLR (Jaguar Land Rover) side." UK-based Jaguar Land Rover is wholly owned by Tata Motors. The company reported an on-year fall of 9.2% in JLR revenue in the June quarter with the EBIT margin contracting to 4% from 8.9% in the year-ago quarter.
The US tariffs hit the revenue and EBIT of JLR in the June quarter, the management said. There was a temporary pause in JLR's shipments to the US in April along with the planned wind-down of legacy Jaguar models in the June quarter, according to the earnings investor presentation. This hit the volumes of JLR for the quarter, the company said in the investor presentation.
The global demand is likely to remain challenging and "also a bit confusing" in the short term, the management said in the investor call. Despite these challenges, and on the expectation that the impact of US tariffs will reduce going forward, the company was sticking to JLR's EBIT guidance for FY26. The company said in the earnings investor presentation JLR's FY26 EBIT margin will likely be in the range of 5-7%.
In the commercial vehicles segment of the company, the management said the heavy commercial vehicle volumes declined in the June quarter mainly due to regional demand shifts and early onset of monsoons. There was an impact on the volume for a few weeks during the June quarter due to the Indian military response under Operation Sindoor, it said. The company also saw volumes in the eastern region being impacted "to some extent due to the Bangladesh issue."
Talking of Tata Motors' full-year outlook for commercial vehicles, a top executive said the volume should pick up from the festive season. He said the June and March quarters are generally good. According to the management it is very important for the company to see how the September and December quarters pan out, particularly "what kind of tenders come from the government in both ICE (internal combustion engine) and electric" commercial vehicles.
The company announced its June quarter earnings post market hours Friday. Shares of Tata Motors closed at INR 633.70, down 2%, on the National Stock Exchange. End
Edited by Deepshikha Bhardwaj
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (11) 4220-1000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2025. All rights reserved.
To read more please subscribe
Share this Story:
