LATEST NEWS – Tata Motors, the country’s largest automobile company by revenue, has seen its consolidated net profit shrink by a significant 96 per cent in the third quarter on a steep decline in profit at its overseas unit JLR and higher losses in the domestic operations. With a consolidated net profit of just Rs 111.57 crore, the October-December quarter is the worst performing quarter this year.
The decline is higher than expectations. Polls of analysts had suggested that the decline will be in the range of 25-35 per cent. The company had reported consolidated profit of Rs 2,953 crore in Q3 of FY16. The October-December quarter was also significant as it was marked by the exit of Cyrus Mistry, former chairman and allegations and counter allegations between the Mistry and Tata camp on the way businesses are run.
The company’s consolidated sales during the quarter was down about two per cent to Rs 67,864.95 crore. Tata Motors’s stock price slipped to close at Rs 486.80 on the BSE, down 3.68 per cent from the previous day. Its market value at the BSE was down Rs 6,000 crore compared to Monday.
Tata Motors owned JLR, UK’s largest car manufacturer, which also brings bulk of the company’s profits, saw a profit of 167 million pounds during the quarter, down by a steep 62 per cent from 440 million pounds. This was on account of unfavourable foreign exchange, higher marketing expense and depreciation and amortisation, the company said. Revenues, however, rose 13 per cent to 6,537 million pounds. The revenue increase was a result of 8.5 per cent growth in retail sales to 149,228 vehicles owing to higher volumes from China, North America and Europe. READ MORE