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Tata Motors Q1 results: Consolidated net loss widens to ₹5,007 cr, misses estimates | Mint – Mint

Homegrown auto major Tata Motors Ltd on Wednesday reported a consolidated net loss (attributable to shareholders of the company) of 5,006.60 crore for the April-June quarter (Q1FY23). It reported consolidated net loss of 4,450.92 crore in the year-ago period (Q1FY22).

The passenger vehicle giant’s consolidated revenue jumps 8% to 71,934.66 crore as against 66,406.05 crore from a year-ago period.

Analysts had expected the auto major to report a consolidated net loss of 1,263 crore during the June quarter.

The EBIT margin has decreased to 4.4%, reflecting lower wholesales, and weaker product mix.

On Wednesday, the company’s scrip on NSE closed 0.59% higher at 443.75.

British arm JLR saw a 11.3% YoY drop in sales at 4,406 million pounds. The company said that retail sales for JLR in the quarter under review were 78,825 vehicles, broadly flat compared with March quarter and down 37% compared with the year-ago period.

Sequentially, JLR revenues were down 7.6%, impacted by supply challenges including semiconductor shortages, slower than expected ramp-up of the New Range Rover and New Range Rover Sport production and China lockdowns, Tata Motors said.

“We expect demand to remain strong despite worries on inflation and geo-political risks while the supply situation is expected to improve further. Cooling commodity prices are expected to aid improvement in underlying margins. We aim to deliver strong improvements in EBIT and free cash flows from Q2 onwards to get to near net auto debt free by FY24,” the firm said in a regulatory filing.

“With the sequential easing of semiconductor shortage and our ramp-up agility, Tata Motors delivered a strong quarter with sales of 101,113 units registering 100% growth versus Q1FY22.

“We also signed a strategic Memorandum of Understanding with leading e-commerce companies and logistics service providers to deliver 39,000 units of the Ace EV along with its enabling eco-system. Furthermore, we also received a letter of allocation of 1500 e-buses from Delhi Transport Corporation, as part of the larger entitled order of 5000 e-buses, from the recently won CESL tender. Going forward, we remain cautiously optimistic about overall CV-demand while keeping a close watch on interest rates, input costs, transporter profitability, and semiconductor availability,” Girish Wagh, Executive Director Tata Motors, has said.

PRIORITIES AND OUTLOOK FOR FY23

– Improved visibility of chip supply through senior supplier engagement including partnership agreements combined with ramp up of new Range Rover and new Range Rover Sport

– Improving wholesales in Q2 and continuing over the financial year

– Refocus savings, including price increases, of £1bn+ to offset cost inflation

– Aim to deliver significant positive EBIT margin (5%) and positive free cash flows in the full year

LONGER TERM TARGETS

– Reimagine, our strategy to deliver the future of modern luxury to our clients and to achieve net zero carbon emissions across supply chain, products and operations by 2039, continues at pace

– Free cash flow improvements with near zero net debt in FY24

– EBIT margin to double digits by FY26

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