Tata Motors’ first quarter witnessed an 80% plunge in net profit due to challenges at Jaguar Land Rover and soaring commodity costs, despite a significant boost in domestic passenger vehicle sales and revenue.
Tata Motors Passenger Vehicles Ltd reported a sharp deterioration in first-quarter earnings as weaker profitability at Jaguar Land Rover and higher commodity costs weighed on the group, even though revenue rose. The company said consolidated net profit fell 80.3% from a year earlier to ₹775 crore in the June quarter, while revenue from operations increased 9.3% to ₹95,799 crore.
According to the company’s results, earnings before interest, tax, depreciation and amortisation fell 6.4% to ₹7,128 crore, narrowing the margin to 7.4% from 8.7% a year earlier. Profit before tax and exceptional items dropped 59.3% to ₹1,606 crore, while total expenses climbed 12.1% to ₹95,338 crore and materials costs rose 12.7% to ₹60,835 crore. Business Standard earlier reported that Tata Motors had also been hit by softer volumes and weaker JLR earnings, with the group’s revenue and profit both declining in the comparable quarter.
Jaguar Land Rover remained the main drag on performance. Tata Motors said JLR revenue fell 9.6% to £5.97 billion, adjusted EBIT margin eased to 2.8% from 4% and profit before tax and exceptional items sank 68.9% to £109 million. The company attributed the pressure to supply constraints and market conditions, including higher retail incentives. Mint and Motoring Trends reported earlier this year that JLR had also faced cost hits from US tariffs and a cyberattack, underlining the volatility in the premium carmaker’s operating environment.
The domestic passenger vehicle business, by contrast, delivered strong growth. Revenue in India surged 64.8% to ₹17,930 crore as volumes rose 46%, while the EBITDA margin improved to 4.3% from 4% and the EBIT margin narrowed its loss to 0.5% from 2.8%. Tata Motors said its market share in the Vahan registration data rose by more than 200 basis points to 14.3%, keeping its No 2 position, and EV volumes more than doubled to more than 34,000 units.
Looking ahead, managing director and chief executive Shailesh Chandra said the passenger-vehicle industry could grow 15% to 20% in the September quarter, helped by a favourable base, though growth should slow in the second half as comparisons become tougher. He said full-year industry growth should still “safely” exceed 10% and stressed that Tata Motors would not cut investment in future products, technologies or capacity. Chandra also warned that commodity inflation had already cost the domestic PV business about 4.5% of revenue in the June quarter and could worsen in the September quarter, saying the second quarter would be “a tough one” on input costs. Tata plans more aggressive cost cuts and gradual price increases to offset the pressure.
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