December 9, 2024
Tata Motors to increase prices of its passenger vehicles from January, 2025
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Revenue ₹108.0K Cr (+5.7%), EBITDA at ₹15.6K Cr (+6.0%),
PBT (bei) ₹8.8K Cr (+₹3.3K Cr), Auto FCF ₹1.2K Cr (-₹1.3K Cr)
Consolidated (₹ Cr Ind AS) |
Jaguar Land Rover (£m, IFRS) |
Tata Commercial Vehicles (₹Cr, Ind AS) | Tata Passenger Vehicles (₹Cr, Ind AS) | ||||||
---|---|---|---|---|---|---|---|---|---|
FY25 | Vs. PY | FY25 | Vs. PY | FY25 | Vs. PY | FY25 | Vs. PY | ||
Q1 FY25 | Revenue | 108,048 | 5.7% | 7,273 | 5.4% | 17,849 | 5.1% | 11,847 | (7.7)% |
EBITDA (%) | 14.4 | – | 15.8 | (50) bps | 11.6 | 220 bps | 5.8 | 50 bps | |
EBIT (%) | 8.4 | 30 bps | 8.9 | 30 bps | 8.9 | 240 bps | 0.3 | (70) bps | |
PBT (bei) | 8,828 | ₹3,287crs | 693 | £258m | 1,535 | ₹598 crs | 173 | ₹(13) crs |
Tata Motors Consolidated:
TML delivered a strong performance in Q1 FY25 with revenues at ₹108.0K Cr (up 5.7%), EBIT of ₹9.1K Cr (+ ₹0.9K Cr), EBIT margin of 8.4% (+30bps). JLR revenues grew by 5.4% to £7.3b with EBIT margins of 8.9% (+30 bps) driven by favourable volume, mix and material cost improvements. CV revenues grew by 5.1% to ₹17.8K Cr and EBIT margins improved to 8.9% (+240 bps) benefiting from better realizations and material cost savings. PV revenues declined by 7.7%, reflecting the challenging market conditions but EBITDA at 5.8% was up +50 bps driven by material cost reductions. Overall PBT(bei) improved by ₹3.3K Cr to ₹8.8K Cr on lower interest outflow, favourable currency and commodity movements. Net Profit was ₹5.7K Cr (+₹ 2.4K cr yoy).
Corporate actions:
The Board has approved the Scheme of Demerger of Tata Motors into two separate listed companies and is expected to conclude in the next 12 to 15 months. The merger of Tata Motors Finance with Tata Capital is also underway and expected to conclude over the course of next 9 to 12 months. We also expect the process of cancellation of DVR and issuance of ORD shares to be completed in about 2 months. These transactions are subject to necessary approvals
Looking Ahead:
Global demand is likely to remain muted and we expect gradual improvement in domestic demand during the rest of the year on account of continued investments in infrastructure, healthy monsoons, favourable macros and festive demand. Commodities are likely to remain range bound.
PB Balaji, Group Chief Financial Officer, Tata Motors said:
“The first quarter has carried forward the momentum of last year with all businesses continuing to deliver on their distinctive strategies. We are confident of sustaining the performance in the coming quarters and delivering a strong year.”
Highlights
Reimagine Transformation continues
Modern Luxury
Enterprise
Sustainability
Financials
The positive momentum in JLR’s financial performance continued in Q1 FY25, driven by higher wholesale volumes, investment in demand generation and a favourable pricing environment. Revenue for Q1 FY25 was £7.3 billion, the best Q1 revenue on record, up 5% versus Q1 FY24. PBT (bei) in Q1 FY25 was £693 million, up from £435 million a year ago. EBIT margin was 8.9%, up 30 bps yoy. The higher profitability year-on-year reflects favourable volume, mix and material cost improvements, offset partially by increased marketing spend compared to a year ago.
Looking ahead
Looking ahead, we are likely to witness constrained production in Q2 and Q3 reflecting the annual summer plant shutdown and floods at a key aluminum supplier. As we work towards mitigation and recovery, we will hold our guidance on our key full year financial deliverables of >8.5% EBIT and achieving net cash.
Adrian Mardell, JLR Chief Executive Officer, said:
“Thanks to the hard work and commitment of our people, JLR has delivered an outstanding set of results in the first quarter, with record revenues and an increase in year-on-year quarterly profits of nearly 60 per cent. We are making great progress delivering our Reimagine strategy. Our Jaguar TCS Racing Formula E Team, pioneers in electric technology innovation, are winners of this year’s ABB FIA Formula E Team and Manufacturer’s World Championships. We are bringing the lessons learned from this success on the racetrack to our luxury electric vehicles and later this year we will unveil our first next generation luxury electric vehicle, Range Rover Electric, which has more than 41,000 customers on its waiting list.”
Highlights
Financials
During Q1 FY25 M&HCV segment led the growth. While HCV demand held up well, market sentiment remained positive in MCV segment with demand increasing in e-commerce, auto-aggregates and LPG segments. The volumes were up by 5.7% majorly driven by medium and heavy commercial vehicles. The revenues improved by 5.1% to ₹17.8K Cr. The business witnessed strong EBITDA and EBIT margins of 11.6% and 8.9%, respectively in Q1 FY25 lead by better realizations and cost savings and reported strong PBT (bei) of ₹1.5K Cr.
Looking ahead
The forecast of a healthy monsoon, expectations of policy continuity and continuing thrust on infra related developmental projects by the Government are expected to improve the demand for commercial vehicles. The demand in staff, intercity, and stage carriage segments should also remain healthy despite the seasonal dip often seen in school transportation in Q2 FY25. We will continue to drive our demand-pull strategy anddrive customer preference through innovation, service quality and thematic brand activation. The business will continue to focus on strong EBITDA delivery, higher ROCE and unlocking value through downstream businesses.
Girish Wagh, Executive Director Tata Motors Ltd said:
“Q1 FY25 registered a positive start for the Indian commercial vehicles sector. Tata Motors recorded commercial vehicles domestic sales of 87,615 units, ~7% higher than Q1 FY24 sales. Overall positive market sentiment arising from increased economic activity, continuing infrastructure development, and growing demand of e-commerce, auto aggregates and LPG segments led to sales improving across most segments – HCV, MCV and CV Passenger. The business delivered strong EBITDA margins of 11.6% in Q1 FY25. Looking ahead, the widespread onset of monsoon, expectations of policy continuity in the forthcoming budget and thrust on infrastructure should be conducive towards improving overall demand for commercial vehicles. We will continue to drive our demand-pull strategy, step up customer engagement and improve competitiveness while closely tracking any emerging headwinds arising from interest rates, fuel prices and inflation.”
Highlights
Financials
PV business in Q1 FY25, after a boost in demand initially, saw a decline in retail (registrations) in the month of May and June, influenced by the general elections and heat waves across the country. Volumes stood at 138.8K units (-1.1% yoy) as we readjusted our wholesales in line with retails to keep channel inventory under control. Revenues stood at ₹11.8K Cr (- 7.7% yoy) on account of drop in volumes. Despite this, EBITDA margin improved 50 bps yoy at 5.8%, on account of material cost reduction. EBIT margins declined by 70 bps yoy to 0.3% on account of adverse operating leverage, while PBT (bei) was at ₹173 Cr.
Looking ahead
Although demand has remained less than anticipated, we expect it to pick-up during festive period. New product launches will augur well for the business. Our focus is to increase addressable market by introducing new nameplates, strengthen multi-powertrain strategy to leverage industry powertrain shifts and proactively grow the EV market in India while maintaining market leadership. We will work towards enhancing profitability through scale benefits, improving mix and optimization of cost & capex.
Shailesh Chandra, Managing Director TMPV and TPEM said:
“The Passenger Vehicle industry in Q1 FY25 witnessed retails (registrations) moderating, impacted by the general elections and intense heat waves across the country. Tata Motors sales of 138,682 cars and SUVs was slightly lower compared to Q1 FY24, as we proactively readjusted our wholesales in line with retails to keep channel inventory under control. Our multi-powertrain strategy and strong portfolio of SUVs led to steady sales. While the personal segment retails have grown for EVs, there was a sharp decline witnessed in the fleet segment. Going forward, we expect an improvement in overall sales on the back of the onset of the festive season and the launch of Curvv, India’s first SUV Coupe.”
(CONSOLIDATED NUMBERS, IND AS)
FINANCE COSTS
Finance costs decreased by ₹527 Cr to ₹2,088 Cr in Q1 FY25, on account of reduction in gross debt.
JOINT VENTURES, ASSOCIATES AND OTHER INCOME
For Q1 FY25, net profit from joint ventures and associates amounted to ₹129 Cr compared to ₹211 Cr in Q1 FY24.
Other income (excluding grants) was ₹833 Cr in Q1 FY25 versus ₹677 Cr in Q1 FY24.
FREE CASH FLOWS
Free cash flow (automotive) for the quarter, was positive at ₹1.2K Cr driven by strong improvement in cash profits, partially offset due to seasonality. Net automotive debt was at ₹18.6K Cr.
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