The India business of the PV division reported a better-than-expected fourth quarter. Meanwhile, JLR was a mixed set, with lower volumes impacting its revenue.
India standalone business
Tata Motors PV’s revenue for its India business increased by 49% to ₹18,700 crore above the CNBC-TV18 poll of ₹17,800 crore.
Its margin surged by 150 basis points to 9.4% and also expanded from Street estimates of 7.5%.
Passenger vehicle and electric vehicle volumes increased 37% from the previous year.
Its margins were driven by favourable volumes and mix and operating leverage. Adverse pricing and commodities offset the favourable impact of volumes and mix.
JLR
Jaguar Land Rover’s (JLR) revenue declined 11.1% to £6.9 billion and was also Street estimates of £7.4 billion.
Its earnings before interest, tax, depreciation and amortisation (EBITDA) margin declined 130 basis points to 14%. However, it was above Street estimates of 10.4%
JLR’s volumes and profitability were impacted by the planned wind down of the outgoing Jaguar models and the competitive environment the automotive industry is facing in China.
JLR said it will reduce breakeven volumes towards 3 lakh in two years.
CLSA positive on stock
Brokerage firm CLSA has an “outperform” raring on Tata Motors PV and a price target of ₹468 apiece, indicating an upside of 38% from its previous closing price.
It said JLR’s EBIT margin came in at 9.2% as its production normalized. It delivered on its EBIT margin and free-cash-flow guidance for the financial year 2026, with no change in the investment outlay of £3.6 billion, CLSA said.
With multiple new launches, especially EVs and further cost reduction measures, JLR expects to step up growth with improved profitability and reduced free cash flow breakeven volume to 3 lakh this year, CLSA added.
Tata Motors PV also remains confident of beating domestic passenger vehicle market growth and expects the industry volumes to grow by 10% in FY27.
With new launches and facelifts, Tata Motors PV is confident of gaining scale to cushion its margin in adverse times, CLSA added.
Stock reaction
Shares of Tata Motors PV gained up to 8% on Friday to hit an intraday high of ₹366.95 apiece.
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