ET: Tata Motors Q3 hits China wall: Major takeaways

7 February 2019: Tata Motors dropped a shocker on Thursday when the auto major reported its biggest-ever quarterly loss for October-December.

Net loss came in at Rs 26,961 crore for the quarter compared with a net profit of Rs 1,214.60 crore in the year-ago period.
Bottom line was impacted by an exceptional item of asset impairment in JLR of Rs 27,838 crore.

Here are top takeaways from Tata Motors Q3 results.

Revenue: Consolidated revenue increased 5.79 per cent YoY to Rs 76,264.69 crore during the quarter under review. “Weak sales in China and de-stocking impacted JLR,” Tata Motors said in a release.

Ebitda: The figure declined 8.50 per cent YoY to Rs 6,522 crore. Ebitda margin slipped by 370 basis points to 0.1 per cent.

Updates on JLR: JLR reported net loss of 3,129 million euros in Q3 FY19 while revenue of the subsidiary declined 1.40 per cent to 6.20 billion euros. “One time exceptional non-cash charge taken for asset impairment read 3.1 billion euros. It reduces growth in depreciation and amortisation by 300 million euros per annum,” Tata Motors said in a release.

“Performance was impacted by challenging market conditions, particularly in China and inventory corrections. We continue to invest in exciting products and leading edge technologies. Taking decisive actions to make the business fit for future by stepping up competitiveness, reducing costs and improving cash flows,” it stated.

Management-take: “Tata Motors domestic business continues to see strong momentum and has delivered market share gains as well as profitable growth. The Turnaround 2.0 strategy is delivering well with a continuing portfolio of product launches, which are the requisite building blocks for sustainable growth,” said N Chandrasekaran, Chairman.

“In JLR, the market conditions continue to be challenging, particularly in China. The company has taken decisive steps to step up competitiveness, reduce the costs and improve cash flows while continuing to invest in exciting products and leading edge technologies. With these interventions, we are building Tata Motors group to deliver strong results in the medium term,” he added.

Total expenditure: Consolidated expenditure jumped to Rs 78,797.08 crore in Q3 FY19 over Rs 72,303.95 crore in the same period last year.

The Economic Times reported

Categories: Indian Earnings

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