Tata Motors, one of the leading passenger and commercial vehicle manufacturers has announced its financial results for FY2023.
The company posted robust results on the back of strong performance across its product portfolio. In Q4 FY2023, the company reported consolidated revenues of Rs 105,932 crore, EBITDA at 14,100 crore, and PBT at Rs 5,000 crore.
It attributed the performance to the continued improvement in volumes on the back of strong India demand and better supplies at Jaguar Land Rover. The pricing actions and richer mix led to improved ASPs and higher revenue growth along with easing inflation, better mix, pricing actions and favourable operating leverage resulted in strong improvements in margins and profits.
For FY202 the business recorded an all-time high revenue of Rs 345,967 crore, and profit before tax of Rs 1,467 crore. The India business net debt was the lowest in 15 years at Rs 6,200 crore.
The brand-wise performance saw JLR improve its net debt to 3 billion pounds with cash of 3.8 billion pounds and liquidity of 5.3 billion pounds. It has a strong order book of 2 lakh units with the Range Rover, Range Rover Sport, and Defender contributing 76 percent of the sales.
Adrian Mardell, Interim CEO, Jaguar Land Rover said, “We increased production and delivered revenue, profit, free cash flow and wholesales growth as chip supply continued to improve. For the fiscal year ahead, while we are mindful of the headwinds that remain, our target is to increase EBIT margins to over 6 percent and deliver significantly positive free cash flow to reduce our net debt further, while increasing investment to 3 billion pounds.”
Commercial and passenger vehicle sales
The commercial vehicle business on the other hand saw sales of 112,500 units, registering a flat growth. The domestic retail was 114,200 units, up 6 percent.
Girish Wagh, President, CVBU – Tata Motors said, “The Indian commercial vehicles sector, showed promising growth in FY2023 supported by a steady recovery in the economy, rising industrial activity and reopening of market which helped regenerate demand. We focused on creating ‘Demand Pull’ to step up registration market share, improve realisations and profitability. This led to achieving double-digit EBITDA margins in Q4. Overall, Tata Motors CV domestic business grew around 22 percent in FY2023 versus F20Y22.”
In terms of the passenger vehicle business, Tata Motors is making strong headways in terms of both expanding its product portfolio and customer acceptance. The company sold 538,500 vehicles, which was higher by 45 percent YoY. In FY2023 the penetration of CNG vehicles and EV for Tata Motors came at 8 percent and 9 percent respectively. The PV business generated revenue of Rs 47,900 crore, up 52 percent and profit before tax of Rs 700 crore.
Shailesh Chandra, MD, Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility said: “Passenger vehicle sales grew steeply in FY2023 to set a new record for the Indian auto industry. Tata Motors recorded its third successive year of industry-beating growth registering its highest ever-annual domestic sales and achieved a robust 46 percent sales growth over FY22. Tata Motors crossed the significant landmark of 50,000 annual sales in EV’s, its highest ever, to post a growth of 154 percent over FY22. We successfully grew our leadership position by accelerating both EV adoption and the development of its enabling ecosystem. Going forward, we will continue to deliver on new product launches, debottleneck capacities and drive EV penetration further to deliver market-beating growth in coming years.”
Growth outlook
The company says it remains optimistic on the demand situation despite near-term uncertainties and expects a moderate inflationary environment in the near term.
Tata Motors states that it aims to further improve and deliver a strong performance in FY2024. The momentum is expected to build through the year factoring in seasonality, stabilisation of JLR supply chain and post-RDE impact in India.
PB Balaji, Group CFO, Tata Motors said: “The year ended on a strong note with all automotive verticals delivering robust performances leading to multiple all-time high achievements. The distinct strategy employed by each business is delivering, in unison, leading to a sharp improvement in overall results. We remain confident on growth with cash flow generation, to achieve our stated goals.”
