Led by JLR, Tata Motors  smashes forecasts in Q3

Mumbai :  Tata Motors posted a stellar set of numbers, yet again boosted by its British arm Jaguar Land Rover (JLR)  that helped it post a near three-fold spike in December quarter net at Rs 4,805 crore, coupled with a one-time profit from sale of investments and tax write-back.

JLR reported a doubling of profit at 619 million pounds for the last quarter of 2013.          The Britain-based company’s profit was up from 296 million pounds for the same quarter in 2012. Revenues expanded 40 per cent to 5,328 million pounds from 3,804 million pounds in the same quarter a year ago.

This is for the eighth straight quarter that JLR, which Tata Motors had bought as a sick company in 2008 and successfully turned around, has given an impetus to the parent’s numbers.

Led by JLR, Tata Motors  smashes forecasts in Q3

Operational performance continues to be a concern… we do not see a pick up in demand for the next few quarters, the performance will be depressed” C Ramakrishnan, Chief Financial Officer

Also, this is the highest net profit since Rs 6,234 crore net the city-based auto major had reported in March 2012 quarter, which also sells the world’s cheapest car Nano.

Sales of the iconic brands during the third quarter rose 27 per cent year-on-year to 112,172 vehicles, driven by the popularity of the Jaguar XJ and XF, and the Range Rover Sport.

The UK-based premium automaker achieved earnings before interest, tax, depreciation, and amortisation margin of 17.9% nearly 200 basis points higher than estimates, and 390 bps higher than the same period a year ago.

Tata Motors’ consolidated EBITDA margin rose 320 bps to 16.5% on the back of sharp expansion in JLR’s margins. JLR recorded net revenue at 5.33 bln pound sterling during the quarter, 40.1% year on year.

The company generated free cash flow of 234 mln pound sterling during Oct-Dec, Tata Motors Chief Financial Officer C. Ramakrishnan said during a press conference here.

During the reporting period, the revenues of the domestic business dipped to Rs 7,770 crore down from Rs 10,630 crore a year ago.

However, its domestic passenger and commercial vehicles divisions continued to be the laggard, yet reported a profit Rs 1,250 crore for the quarter on sale of investments, while profit from JLR more than doubled to 619 million pounds.

China and North America continued to be the biggest markets for JLR, its chief executive Ralf Speth said, adding the overall trends in the global economy make him confident of a better show henceforth as well.

Ramakrishnan, however, painted a pessimistic picture on the domestic front, saying the company expects demand to be suppressed for a few more quarters.

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