Tata Motors drives into the black with Rs 3,764 crore profit in Q2FY24

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26 Aug, 2025 12:21

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Tata Motors on November 2 reported a consolidated net profit of Rs 3,764 crore for the second quarter. The homegrown automaker posted a consolidated net loss of Rs 945 crore in the corresponding quarter last year.

According to industry analysts, the company has become profitable due to a pick-up in volumes in the domestic market, softening commodity prices, a volume ramp-up at its luxury car subsidiary Jaguar Land Rover (JLR), and improved operating leverage.

The Mumbai-based company reported a growth of 32.1 percent in its consolidated net revenue to Rs 105,128 crore in the quarter that ended September 30, 2023. In the same period last year, revenue stood at Rs 79,611.4 crore.

Group chief financial officer P.B. Balaji said, “It is pleasing to see all the businesses deliver on their well-differentiated plans this quarter. With a strong product pipeline, a seasonally stronger H2 and continued focus on cash accretive growth, we are confident of sustaining this momentum.”

The results exceeded analysts’ expectations, as the average estimate of five brokerage firms had said that the company's revenue from operations may increase by 28 percent to Rs 1,01,155 crore. The five brokerages had pegged the average bottom line at Rs 4,408 crore.

The company’s earnings before interest, taxes, depreciation and amortisation or EBITDA for the three months came in at Rs 14,400 crore, up 86 percent from Rs 5,571 crore earned a year ago. Operating margin improved by 400 basis points (bps) to 13.7 percent in Q2FY24 from 7.8 percent in the year-ago period due to lower raw material costs and operating leverage benefits.

On a standalone basis, Tata Motors reported a net profit of Rs 1,270 crore for the September quarter against a net loss of Rs 293 crore during the same period last fiscal. Revenue at its British arm JLR revenue surged by 30.4 percent to £6.9 billion, driven by higher wholesales, better mix, cost reductions and investment in demand generation.

Tata Motors’ total sales volume across all segments for the July-September quarter of FY24 rose marginally to 2,43,024 units from 2,42,861 units in the same quarter of the previous year. While passenger vehicle (PV) sales during the quarter fell 2.4 percent to 1,38,939 units, commercial vehicle sales increased by 3.5 percent to 1,04,085 units.

“With deliveries commencing of our new-generation products, we expect stepped-up volumes and profitable growth in the second half of the year,” said Shailesh Chandra, managing director, of passenger vehicles.

Sales at JLR, excluding its China joint venture, jumped 29 percent to 96,817 units. The company claimed that the continued improvement in the supply of specialised semiconductors helped ramp up production and sales.

The Tata Motors scrip closed 1.51 percent higher at Rs 636.80 on the BSE on November 2 ahead of the earnings announcement.

“Looking ahead, production and wholesale volumes are expected to gradually increase in the second half of the current fiscal. The EBIT margin for FY24 is expected to improve to about 8 percent as compared to 6 percent-plus previously indicated," Tata Motors said in a statement.

The British brand continues to expect free cash flow of over £2 billion in FY24 with net debt reducing to less than £1 billion by the end of FY24, it added.

Tata Motors also stated that it remained optimistic about demand despite external challenges and anticipated a moderate inflationary environment.

“We aim to deliver a stronger performance in H2 (April-September), due to a healthy order book at JLR, strong demand for heavy trucks in the commercial vehicle space and new generation products in the passenger vehicle segment,” the statement added. “Despite lower volumes and adverse mix, margin improvement was led by strong savings in commodity costs,” it said.