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Informist, Thursday, Jan. 29, 2026

By Anand JC and Durgesh Nandan

MUMBAI – Tata Motors Ltd. T    hursday said despatches of its commercial vehicles will continue to grow in double digits year-on-year, as it did in the December quarter, even in Apr-Sept this year driven by a favourable base, its management told analysts in a post-earnings conference call. The company's wholesale sales grew 20% on year to 116,800 units in the reporting quarter, with broad-based growth seen across segments.

While domestic despatches remained strong, exports grew 70% on year, although it formed a very small chunk of its overall sales mix. The company said it is still behind the peak of export sales growth seen in 2016-17 (Apr-Mar), but it has seen a sharp recovery in the recent quarter. Growth in overseas markets was driven by recovery in countries including Sri Lanka and Bangladesh. It is also seeing fresh demand in West Asia and North Africa. "In FY17, we had a very, very high salience of SAARC (South Asian Association for Regional Cooperation) market. I think it has moderated significantly now and we are happy with the market we have now," Tata Motors' Managing Director and Chief Executive Officer Girish Wagh said.

Tata Motors reported a net profit of INR 5.61 billion for the December quarter on revenues of INR 204.04 billion. Its bottom line was weighed down by exceptional items cost of INR 15.45 billion, which constituted costs worth INR 5.74 billion incurred towards implementation of the four new labour codes and INR 9.62 billion paid as stamp duty to transfer land as part of its demerger from passenger vehicle operations. Adding back this one-time cost, the company's net profit improved to INR 21.06 billion--higher than the consensus estimate.

Its total expenses for the quarter grew 16% on year to INR 183.58 billion, with input costs rising 23% on year to INR 120 billion. The company said precious metals and non-ferrous metals such as copper saw inflation during the reporting quarter. "As we look forward into Q4, these are the same set of commodities which are posing some headwinds. And steel prices also in open market have gone up...," the company said. To mitigate this, Tata Motors took a price hike of 1% from Jan. 1 across its product range.

The average selling price of the company's vehicles moderated in the December quarter. While volumes of heavy commercial vehicles, which are typically priced at a premium, increased in the reporting quarter, that of intermediate, light and medium commercial vehicles, and other segments such as small vans increased as well. This broad-based rise in volumes hit its realisation on a year-on-year basis, even as it went up on a quarter-on-quarter basis.

This sudden surge in demand across segments led to a supply constraint, the company said. "Some suppliers...specifically in the area of castings, one has seen the capacity bottlenecks being reached. And therefore, I think there are specific de-bottlenecking actions which have already initiated in the supply chain," Wagh said. "The rate at which the demand has gone up and therefore production at all the OEMs is something which is quite significant, which has led to some stress," he said.

Commercial vehicle makers had expected replacement demand to increase after the government slashed goods and services tax in September. "The replacement demand for trucks is most likely gaining momentum post GST 2.0 because it has prompted the fleet operators to initiate vehicle replacement that were previously delayed. The shift has become more financially viable due to lower EMIs resulting from lower initial prices," Wagh said. A similar trend is also being seen in the bus segment as several state governments are prioritising phased replacement of ageing fleets across both intercity and intracity bus services.

The company's order book for government buses currently stands at around 6,000 units, from various authorities such as Maharashtra State Road Transport Corp., Gujarat State Road Transport Corp., North Western Karnataka Road Transport Corp., among others. Government tenders, which drive demand for this segment significantly, have increased after COVID-19 pandemic. "This should continue for some more time and we are also seeing a good demand coming from the school vans kind of a category," Wagh said.

Additionally, the company is also banking on electric buses to grow demand in the segment, even if it is only in early stages of adoption. "Electric buses, which are just at, I would say, very, very initial stages of growth, can also be a category to look forward to in terms of higher growth as we go ahead," Wagh said.

The company disclosed its December quarter earnings after the market closed. Thursday, its shares closed 0.5% higher at INR 470.20 on the National Stock Exchange.  End

Edited by Akul Nishant Akhoury

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