Tata Motors Ltd announced its results for quarter ending March 31, 2022. The results represent the details on consolidated segment level. Please refer 'Reporting format' section in the end for details.

Jaguar Land Rover (JLR): Revenue was GBP4.8 billion in Q4 FY22, up 1% from Q3 FY22, reflecting the higher wholesales offset partially by the impact of the runout of the previous generation Range Rover, with the New Range Rover still ramping up. The EBIT margin in the quarter was 2.0% with profit before tax about breakeven (GBP 9 million) before GBP (43) million exceptional charge for our business in Russia. Free Cashflow improved to GBP340 million, up from GBP164 million in Q3.

Tata Commercial Vehicles (Tata CV): Tata CV business continued to show strong sequential recovery led by MHCV segment. The business clocked its highest quarterly revenues since Q4'FY19 and grew market shares in all segments. Despite lower margins due to commodity inflation, impact was lower on PBT (bei) of ? 607 Crores in Q4 due to operating leverage from higher revenues.

Tata Passenger Vehicles (Tata PV): Tata PV business delivered a comprehensive turnaround in Q4 FY 22 with highest quarterly revenues of ?10.5 K Cr (+62%), positive EBIT 1.2% and positive free cash flows. EV volumes rose to 9.1K units in Q4 and PV market share improved to 13.4% (+440bps). Robust demand for 'New Forever' range and agile supply actions led to this strong performance.

Outlook: The demand remains strong despite geopolitical and inflation concerns. The supply situation is gradually improving, whereas commodity inflation is likely to remain at elevated levels. We expect performance to improve through the year as the China COVID and semiconductor supplies improve and aim to deliver strong EBIT improvement and free cash flows in FY 23 to get to near net auto debt free by FY 2024.

JAGUAR LAND ROVER (JLR)

Highlights

Company sees increase in free cash flow and EBIT margin in Q4, but sales remain constrained by global semiconductor shortage

Wholesales improved 11% in Q4 to 76.5K units while full year volumes of 294,182 were down 15%

Quarterly free cash flow again positive and increased to GBP340 million in Q4; full year cash outflow of GBP1.16 billion, reflecting working capital impact of lower volumes in the first half.

Q4 EBIT margin of 2.0% with pre-tax profit before exceptional items about breakeven (GBP9 million); full year EBIT margin at (0.4%) with pre-tax loss before exceptional items of GBP0.4 billion.

Exceptional charge of GBP43m in the fourth quarter relating to our business in Russia

Strong demand for New Range Rover helps order book to new record at more than 168,000 units (New Range Rover 46, 000 units and Defender 41,000 units), up 13,000 units in Q4.

Our Refocus transformation programme delivers GBP1.5 billion of value in the year, beating GBP1 billion target.

Liquidity of GBP6.4 billion as at 31 March 2022, including GBP4.4 billion cash and a GBP2 billion undrawn revolving credit facility.

Looking Ahead

The CV industry is poisedfor further growthon the back of increased activity in road construction, mining and improved infrastructure spending. The supply situation continues to show gradual improvement. Despite uncertainties, business sentiments continue to be positive with increasing fleet utilization levels and freight rates. Sharp commodity inflation, however, continues to remain a challenge. The Company will continue to step-up its investments in products and new business models to deliver customer value while ensuring profitable growth. Despite near-term supply challenges and inflation concerns, the business aims to deliver strong margins recovery and profitability in FY23.

Girish Wagh, Executive Director Tata Motors Ltd said: 'The Indian Commercial Vehicles sector, deeply impacted for two successive years, showed promising signs of growth in FY22 supported by a steady recovery in the economy, rising industrial activity and reopening of markets. At Tata Motors, the early adoption of a holistic 'Business Agility Plan' enabled us to protect and serve the interests of our customers, dealers and suppliers as well as smartly manage supply related challenges including the global shortage of critical electronic parts. The improvement in consumer sentiment, buoyancy in e-business, firming freight rates, reopening of schools and offices and higher infrastructure spends in road construction and mining helped regenerate demand. We optimized production, introduced new passenger and cargo mobility solutions and accelerated sales to grow every quarter and gain higher market share in every segment of commercial vehicles. Looking ahead, we see significant opportunities to leverage the mega trends shaping the Indian automotive industry. We are keeping a close watch on geopolitical developments, fuel inflation and semiconductor shortage and remain optimistic whilst continuing to work closely with our customers and ecosystem partners to mitigate risks and manage uncertainties.'

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