New Delhi, Aug 1: Tata Motors group today reported a consolidated net loss of Rs 1,862.57 crore for the first quarter ended June 30, dragged down by multiple challenges that its British arm JLR faced in major markets, including China, UK, Europe and the US.
The company had reported a net profit of Rs 3,199.93 crore in the April-June quarter of 2017-18. Total revenue from operations, however, rose to Rs 67,081.29 crore as compared with Rs 59,818.22 crore in the year-ago period, Tata Motors said in a regulatory filing.
On a standalone basis, the company reported a net profit of Rs 1,187.65 crore. It had reported a net loss of Rs 463.14 crore in the first quarter last fiscal. Standalone total revenue from operations grew to Rs 16,803.11 crore during the quarter compared to Rs 10,366.19 crore in the same period of 2017-18.
Standalone volume rose 59 per cent to 1,76,868 units driven by robust sales of commercial and passenger vehicles.
JLR revenue, however, declined 6.7 per cent to 5.2 billion pounds and its loss stood at 210 million pounds during the quarter. Retail sales of JLR during the period stood at 1,45,510 units, up 5.9 per cent from the year-ago period.
However, wholesales were lower by 13,950 units from the retail numbers in expectation of import duty cut in China to 10 per cent from 25 per cent from July 1. Commenting on the domestic business, Tata Group Chairman Natarajan Chandrasekaran said the company continues to gain market share, while strongly improving profitability in both commercial vehicles and passenger vehicles.
"With regards to JLR, we faced multiple challenges, including temporary issues like China duty impact as well as the market issues like diesel concerns in the UK and Europe," he added. Despite these challenges, the company remains committed to delivering the plan it outlined earlier this year, Chandrasekaran said.
Tata Motors CEO and MD Guenter Butschek said there could be a few challenges in the short term particularly in commercial vehicles as the new regulations on axle loads come into effect.
"But, we remain positive on the long-term potential of the Indian market and I am confident that Tata Motors is taking the right steps to drive competitive, consistent, cash-accretive growth," he added.
Addressing a conference call, Tata Motors Group CFO P B Balaji said: "For us, India continues to shine and there are temporary headwinds we see in China because of the duties that happened there". He said the destocking after duty reduction in China had an impact on the company's profitability.
"However, China is one-off and we see it reversing going forward," he added.
In the UK, Balaji said JLR faces a big challenge due to uncertainty over diesel vehicles and Brexit issues, while demand continued to be weak in the US.
On the domestic front, Balaji said there is a lot of confusion in the commercial vehicles (CVs) market over the axle-load norms that the government has announced.
"It is too early to assess its impact on volumes but it is fair to say that we are expecting temporary impact but there is inherent demand for CVs," he said.
At the moment, Tata Motors is working to re-engineer, re-validate and re-certify its CVs to comply with the new axle-load norms, he added.