Economy

Living CSR a basic ingredient of Tata Motors' success: Butschek

Living CSR a basic ingredient of Tata Motors' success: Butschek

One key reason that dented investors' hope in Tata Motors was weak performance of the company's luxury vehicle brand Jaguar Land Rover (JLR). Revenue increased 4.3% to 6.31 billion pounds. ALSO READ: The pre-tax profit of luxury auto maker JLR declined to £192 million in the quarter compared to £255 million in the corresponding quarter of a year ago (which also included a $85 million insurance recovery).

In the period, retail sales showed a growth of 3.5 per cent to 154,447 units, driven by a 14.6 per cent increase in unit sales in China and an 18.2 per cent rise in overseas markets. The Ebitda (earnings before interest, depreciation, taxation, and amortisation) of the standalone business margin improved 750 basis points to 9 per cent in the quarter.

According to N Chandrasekaran, chairman of Tata Sons, the "turnaround strategy" is delivering results in the domestic market.

As Indian markets witnessed a blood math on Tuesday's trading session, share price of Tata Motors also faced heavy selling pressure so much so that the company tumbled almost 10% despite clocking eleven-fold rise in its Q3FY18 financial performance. Bharat Gianani, research analyst (Auto/Auto Ancillaries) at Sharekhan, said the company's third were in line with the estimates operationally.

While the quarter saw an improvement in market share of both its commercial and passenger vehicles, the growth was driven by increased demand for high tonnage vehicles, new products, government funding in infrastructure development and e-commerce growth.

Tata Motors India will be investing Rs 1,021 crore in products, platforms and technologies this year.

More news: Russians cleared of doping eligible for Games - IOC

"In a market that is facing significant disruptions, Jaguar Land Rover will invest for growth while continuing its journey of sustainable profitable growth". "JLT profitability was impacted by the run-out of the 17 model year Range Rover and Range Rover Sport and higher depreciation and amortisation resulting from continued investment to drive profitable growth", the company said. The launch of products like the Nexon, Tigor, and helped volume growth.

Growth in China was offset by flatter demand in the UK, the United States and mainland Europe due to uncertainty over the regulation of diesel and concerns over Britain's departure from the European Union, the company said in a statement.

The numbers reflect its progress.

At the group level, it had net debt of Rs 47,777 crore up from Rs 27,485 crore in March 2017, reflecting negative free cash flow at JLR with continued high investments and unfavourable working capital related to new model launches.

The share price gained over 3 per cent to close at Rs 396 at the BSE in anticipation of improved performance.


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