Updated 13:23 IST, January 30th 2025
Tata Motors Q3 Results: Hits 14-Month Low, Demand Concerns For JLR - See Details
Following the disappointing results, investor confidence weakened, leading to the sharp decline in Tata Motors’ stock price.
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Tata Motors' shares dropped 9 per cent to a 14-month low on Thursday after its third-quarter results raised concerns over the growth and margins of its luxury brand, Jaguar Land Rover (JLR). The stock was the biggest loser on both the Nifty 50 and Nifty Auto indices, with Nifty 50 trading 0.41 per cent higher, while the auto index declined 0.3 per cent .
Tata Motors flagged weak demand in China for JLR but expressed optimism that sales would improve in the current quarter. However, analysts remain cautious. BofA Securities noted that JLR's growth and margins for FY26 remain uncertain, while Motilal Oswal pointed out that Tata Motors' 8.5 per cent full-year margin target will be difficult to achieve.
Other brokerages, including Jefferies, highlighted that JLR is struggling in China and Europe as consumers increasingly prefer cheaper local alternatives. Tata Motors stated it will closely monitor demand in these regions.
Tata Motors: JLR Profits Decline
JLR’s pre-tax profit fell 17 per cent year-on-year to £523 million ($651 million). Since JLR accounts for 75 per cent of Tata Motors' total pre-tax profit, this decline has significantly impacted overall earnings.
In the domestic market, Tata Motors' local car sales grew by just 1 per cent , lagging behind the industry average of 4.5 per cent . This slower growth adds further pressure on the company's performance.
Tata Motors: Q3 Results
Tata Motors reported a Q3 profit of ₹54.51 billion, which was well below analyst expectations of ₹67.42 billion. As a result, at least 10 brokerages cut their price targets, and five downgraded their ratings on the stock.
Following the disappointing results, investor confidence weakened, leading to the sharp decline in Tata Motors’ stock price. Exchange rates: $1 = ₹86.58, $1 = £0.8034.
Published 13:23 IST, January 30th 2025