Tata Motors Q2 net loss widens
Shares of Tata Motors surged 5% to Rs 505.15 in early trade on BSE despite reporting a higher second quarter loss.
Homegrown auto major Tata Motors (TML) on Monday reported a widening of consolidated net loss to Rs 4,441 crore for the second quarter ended September 30, due to higher expenses and lower sales of its British arm JLR following semiconductor shortage.
The company had posted a consolidated net loss of Rs 314 crore in the same period last fiscal.
The Mumbai-headquartered company’s revenue from operations rose 14% to Rs 61,378 crore in the reporting period as against Rs 53,530 cr in the last year period.
The company’s operating profit margins shrank 210 basis points in the second quarter to 8.4%.
The India business revenues were up 91% over last year and a 130 basis points improvement in operating profit margins during the quarter at 3.9%.
For the second quarter, Jaguar Land Rover (JLR) had a revenue of 3.9 billion pounds with a pre-tax loss of 302 million pounds in the second quarter.
JLR believes the worst of the chip shortages are behind and volumes should gradually improve in 2H. It is seeing good demand, has strong order book, and next-gen RR/RR-Sport launches should boost volumes.
India business should continue to improve sequentially driven by demand recovery, market share gains and better margins.
JLR wholesales in the second quarter were 64,032 units, down 12.8% from the year-ago quarter, and retail sales, including the China joint venture, stood at 92,710 units, down 18.4%, reflecting the semiconductor shortage and lower retailer inventories.
JLR’s order book is strong at 125,000 units, while dealer inventories are at historically low levels. New generation products like RR/RR sport are likely to be launched in coming quarters. Chip supplies should improve ahead but at a slower rate than expected.
Car makers have been forced to make sharp production cuts this year as supply chain disruptions and booming demand for consumer electronics have led to an acute shortage of chips, which have become a critical component in automobiles, powering everything from fuel injection to entertainment systems.
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