Moneycontrol Bureau Shares of Tata Motors slumped 11 percent hitting intraday low of Rs 451.60 on Tuesday after its September quarter disappointed street. Analysts are worried about both its JLR and standalone business. JLR's margins fell 190 basis points at 10.3 percent on annual basis. Hedging losses and forex revaluation of 318 mn pounds impacted JLR margins in Q2.
Credit Suisse has cut FY18-19 estimates by 6-8 percent and trimmed target price to Rs 680 from Rs 720 earlier on weak quarter. It has also reduced standalone estimates on demonetisation impact.
Nomura has also lowered target price to Rs 585 from Rs 601 per share. It says there was a significant forex loss while one time expenses hit earnings as pound depreciated significantly. However, it adds that Tata Motors will see strong margin expansion going ahead as old hedges expire.
Tata Motors posted net profit of Rs 848 crore in Q2 from a loss of Rs 1,740 crore in corresponding quarter last fiscal. During the quarter, its net revenue was up 6.94 per cent at Rs 67000 crore, against Rs 62,647 crore in the year-ago period.
On standalone basis, Tata Motor's net loss widened to Rs 631 crore in Q2 compared to Rs 289 crore year-on-year. Standalone net sales were at Rs 11,406 crore as against Rs 11794 crore in the year-ago period, down 3.28 percent.
The company said that JLR posted strong sales in all the regions -- UK, Europe, North America, China and other overseas markets
At 15:43 hrs Tata Motors was quoting at Rs 457.25, down Rs 50.15, or 9.88 percent on the BSE.Posted by Nasrin SultanaFollow @NasrinzStory
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