Tata Motors Q2 Loss Narrows To Rs 945 Crore

Tata Motors on Wednesday reported narrowing down of its Q2 FY 23 consolidated loss at Rs 944.61 crore compared to a loss of Rs 4,441.57 crore in the same quarter last year.

The auto major's consolidated revenue increased by 29.7 percent in the second quarter to Rs 79,611 crore.

The company's EBITDA margin increased to 29.7 percent in Q2 by 130 bps year on year (YoY).

“Strong demand continuing with client order book now at 205,000 units; our three most profitable models, the New Range Rover, New Range Rover Sport and Defender account for over 70 percent of the order book. Increasing partnership agreements with semiconductor suppliers expected to enable improving volumes in the second half of financial year ending March 2023 and beyond. Improving chip supply and cooling commodity prices will aid revenue and margins recovery and hence aim to deliver strong improvements in EBIT and free cash flows in H2 FY23,” Tata Motor said.

Tata Passenger Vehicles (Tata PV) business continued its strong momentum with wholesales at 142,755 vehicles (over 69 percent YoY), amid strong festive demand and debottlenecking actions. EBIT margins improved by 200 bps YoY to 0.4 percent because of higher volumes, mix and improved realizations.

“Demand for passenger vehicles remained strong in Q2 FY23 fuelled by improving supply of semiconductors, festive season and new launches. The recent festive season (Navratri to Dhanteras) saw 43 percent growth in retail sales over the previous year’s festive season sales. The overwhelming customer response received for the Tiago EV, launched towards the end of the quarter, will further accelerate mass adoption of EVs across the country. Going forward, we remain vigilant about the evolving demand and supply situation and will stay nimble to take necessary actions swiftly whilst focusing on improving profitability further,” said Shailesh Chandra, Managing Director Tata Motors Passenger Vehicles Ltd & Tata Passenger Electric Mobility.

Tata Commercial Vehicles (Tata CV) business registered a 15 percent growth in sales over Q2 FY22. For India business, domestic wholesales were at 93,651 vehicles (over 19 percent YoY). However, exports were at 6,771 vehicles, lower by 22 percent affected by financial crisis in few export markets. Domestic retails grew at a higher rate as compared to wholesales (over 23 percent YoY).

“In Q2 FY23, the CV industry witnessed consistency in demand across segments. Our sharp focus on retail resulted in retail sales outperforming wholesale by 1.3 percent during Q2 FY23. To better serve the evolving needs of our customers, we launched an efficient range of smart trucks in MHCV and ILCV segments, as well as best-in-class pickups, raising the benchmarks for safety, comfort, load carrying capacity while reducing their total cost of ownership,” said Girish Wagh, Executive Director Tata Motors.

Jaguar Land Rover (JLR) revenue was £5.3 billion in Q2 FY23, up 36 percent YoY from Q2 FY22 reflecting strong model mix and pricing with wholesale volumes (excluding China JV) of 75,307 up 17.6 percent YoY and 4.9 percent on the prior quarter.

According to the company, the wholesale increase was lower than planned, primarily due to a lower-than-expected supply of specialised chips from one supplier which could not be readily re-sourced in the quarter. The production ramp up of New Range Rover and New Range Rover Sport improved with 13,537 units wholesaled in the quarter, up from 5,790 in Q1 and helped mitigate this.