Tata Motors Consolidated reported a remarkable performance in the third quarter of FY24, marked by significant growth across key financial indicators. With a staggering 133% surge in net profit and the stock price soaring above 1100%, coupled with increased interest from Foreign Institutional Investors (FIIs), Tata Motors emerges as a compelling investment prospect.
Tata Motors Consolidated Q3 FY24 Results
In Q3 FY24, Tata Motors achieved a commendable revenue of ₹110.6K Cr, marking a substantial 25.0% increase from the previous period. The company’s EBITDA stood at ₹15.8K Cr, reflecting a remarkable growth of 60.6%, while the EBIT reached ₹9.2K Cr, marking an impressive increase of ₹5.3K Cr. Notably, all automotive verticals exhibited profitable growth trajectories, contributing to a robust performance. The Profit Before Tax (PBT) stood at ₹7.6K Cr, marking a notable improvement of ₹4.4K Cr, with a net profit of ₹7.1K Cr. Year-to-Date FY24 figures also showcased a strong performance, with a PBT of ₹19.0K Cr, representing a substantial improvement of ₹22.6K Cr over the previous year. Moreover, the company reported a reduction in net automotive debt to ₹29.2K Cr.
JLR Performance
Jaguar Land Rover (JLR) witnessed a significant improvement in revenue, recording a 22% increase to £7.4b. This growth was fueled by enhanced wholesales and reduced material costs, leading to EBIT margins of 8.8%, reflecting an increase of 510bps. Commercial Vehicle (CV) revenue also surged by 19.2%, with EBIT improving to 8.6%, benefiting from higher realizations and a richer product mix. Similarly, Passenger Vehicle (PV) revenues saw a rise of 10.6%, with EBIT margins improving by 60 bps to 2.1%, primarily driven by savings in commodity costs.
Stock Performance
A glance at the weekly chart of Tata Motors stock reveals a remarkable upward trajectory.
From trading at 70 rupees per share in March 2020, the stock has surged to above 870 rupees per share, delivering exceptional returns of over 1100% to investors.
Looking Ahead
Tata Motors remains optimistic about the future performance of all three auto businesses. With expectations of further improvement in Q4 due to seasonality, new launches, and enhanced supplies at JLR, the company is poised for continued growth. Additionally, Tata Motors achieved a net debt reduction of ₹9.5K Cr in Q3 and is confident in its ability to meet its deleveraging plans.
Tata Motors’ robust Q3 performance, coupled with its promising outlook and impressive stock performance, positions it as a compelling investment opportunity for investors seeking exposure to the automotive sector. However, it’s essential to remember that investing involves inherent risks, and individual circumstances vary. Therefore, while the data presented here showcases a positive trend, it’s always advised to consult a qualified financial advisor before making any investment decisions.
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