Tata Motors Q2 Result: Net Profit Down 11% To Rs 3,343 Crore

Tata Motors' Q2 FY25 earnings fell short of Street expectations. The company reported a 3.5 per cent drop in revenue and an 11 per cent decline in net profit. Its EBITDA margin also shrank by 230 bps

Tata Motors reported an 11 per cent year-on-year (YoY) decline in consolidated net profit for Q2 FY25, which stood at Rs 3,343 crore. The drop was primarily driven by weaker performance at its Jaguar Land Rover (JLR) division and in the commercial vehicles segment. Consolidated revenue for the July-September quarter also fell by 3.5 per cent to Rs 1.01 lakh crore, mainly due to lower sales volumes, as stated in the company's filing with the stock exchanges.

Tata Motors' Q2 FY25 earnings fell short of Street expectations. The company reported a 3.5 per cent drop in revenue and an 11 per cent decline in net profit. Its EBITDA margin also shrank by 230 basis points to 11.4 per cent.

The company offered a cautious outlook in its commentary. "We remain cautious on near-term domestic demand. However, the festive season and substantial investments in infrastructure should help bolster it," it said in the statement.

Jaguar Land Rover (JLR) reported a 5.6 per cent revenue decline, totalling 6.5 billion euros. Tata Motors attributed the drop in profitability to "temporary supply constraints." The EBIT margin for JLR fell by 220 basis points to 5.1 per cent, with profitability impacted by an aluminium supply shortage and the hold placed on 6,029 vehicles for additional quality control checks, according to the company’s statement.

In India, Tata Motors’ domestic commercial vehicle segment saw a 13.9 per cent decline in revenue, which stood at Rs 17,288 crore. The drop was driven by sluggish infrastructure activity, reduced mining operations, and lower fleet utilisation, exacerbated by heavy rains.

"In Q2 FY25, domestic wholesale CV volumes were 79,800 units, lower 19.6 per cent on-year, impacted by slowdown in infrastructure project execution, reduction in mining activity and an overall drop in fleet utilisation due to heavy rains," said Tata Motors.

The segment's EBITDA margin improved slightly to 10.8 per cent, driven by favourable pricing and material cost savings, despite a decline in volumes, the company said. Revenue from passenger vehicles fell 3.9 per cent to Rs 11,700 crore, while EBITDA margins held steady at 6.2 per cent despite weaker demand.