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Informist, Thursday, Oct. 23, 2025

 

MUMBAI – Prolonged operational disruption at the UK-based luxury carmaker Jaguar Land Rover is expected to weigh on the cashflow of its India-based parent company Tata Motors Passenger Vehicles Ltd., said S&P Global late Thursday as it revised outlook on the latter to negative. 

 

"The negative outlook reflects our view that a recovery from the operational disruption following a cyber incident at JLR could be prolonged and lead to Tata Motors PVs' credit metrics staying weaker for longer," S&P said. A major cyber incident rocked the Land Rover maker in September which caused a complete stoppage of its production activities for the entirety of the month. The company has restarted its operations in a staggered manner.

 

While S&P has revised its outlook on Tata Motors Passenger Vehicles lower, it has affirmed long-term issuer credit rating of 'BBB-'.

 

S&P expects the revenue of JLR to decline 15-18% to around 24 billion sterling pounds in the ongoing financial year. The rating firm also expects JLR's profitability to be impacted given its steady rate of investments amid the production slowdown. 

 

"We believe a recovery in JLR's earnings is subject to a series of uncertainties both related to market conditions and to the consequences of the cyberattack," S&P said. The firm noted that JLR could face permanent loss of production volume becuase of the cyber attack. The company also faces pressure from a potential delay in key product launches.

 

"Such risks would intensify if rising sales volumes in other regions are not enough to offset prolonged weakness in China," S&P said. The rating agency expects the domestic business of Tata Motors Passenger Vehicles to generate sufficient cash flow to fund its investment plans and has better credit metrics than JLR. 

 

S&P sees the Indian business of Tata Motors Passenger Vehicles and JLR playing an important role in Tata Sons' strategic plans. "We believe Tata Sons will step in to provide strong support in the event of credit stress to both Tata Motors PVs and JLR, based on Tata Sons' track record," it said. 

 

The rating firm could revise outlook for Tata Motors Passenger Vehicles back to stable if the company's credit metrics improve faster than its base case assumptions.

 

Tata Motors had reported a consolidated net profit of INR 39.24 billion for the June quarter on revenues of INR 1.04 trillion. Its passenger vehicle business had reported a top line of INR 108.77 billion, down just over 8% on year.

 

Thursday, shares of Tata Motors, which only constitutes the passenger vehicle business now, closed 1% higher at INR 405.85 on the National Stock Exchange.  End

 

Reported by Anand JC

Edited by Akul Nishant Akhoury

 

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