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Old 28th August 2016, 11:50   #16
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Tata Motors' net profit for the first quarter of FY2016 has seen a sharp fall of almost 91% - the company closed Q1 of FY2016 with a net profit of only Rs 25.7 crores, as against net profits of Rs 289.84 crores posted during the same Q1 period of the previous fiscal!

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In a regulatory filing in BSE, the company said its total income for the first quarter increased to Rs 12,089.29 crore, as against Rs 11,307.50 crore earned during the quarter ended June 30, 2015.

On a consolidated basis, Tata Motors posted a net profit after tax, minority interest and share of profit of associates of Rs 2,260.40 crore for the period under review, as compared to Rs 5,254.23 crore for the quarter ended June 30, 2015.

The consolidated total income for the first quarter stood at Rs 67,229.69 crore, up from Rs 61,734.29 crore earned during the quarter ended June 30, 2015.
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Old 28th August 2016, 17:26   #17
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

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Originally Posted by RavenAvi View Post
Tata Motors' net profit for the first quarter of FY2016 has seen a sharp fall of almost 91% - the company closed Q1 of FY2016 with a net profit of only Rs 25.7 crores, as against net profits of Rs 289.84 crores posted during the same Q1 period of the previous fiscal!

ET
I wouldn't even trust a weather report published by ToI group! The only thing they do well of late is to provide Sunny Leonne updates!

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Mumbai (AFP) - India's largest carmaker Tata Motors reported a 57 percent fall in quarterly profits Friday, slowed by weak sales of its luxury British unit Jaguar Land Rover and foreign exchange losses.

Consolidated net profit for the three months to the end of August 2016 fell to 22.36 billion rupees ($337.11 million) compared with 52.31 billion rupees a year ago, the Mumbai-based company said in a report.

A Bloomberg poll of 23 analysts had predicted that the manufacturer would report net profits of 25.33 billion rupees for the first quarter ended August.

Tata said in a statement that its profits had fallen due to foreign exchange impact after the Brexit vote.
https://au.news.yahoo.com/a/32455534...r-sales/#page1

It is always tough making sense of JLR quarterly reports as their investment cycles are inconsistent, if I may use that word. One can see the sales have actually increased!

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In the three months to the end of June, retail sales rose 16pc to 132,743 vehicles compared with the same period a year ago, driving up revenues by 9.2pc to £5.45bn.

Sales have been boosted by the introduction of new models such as the “baby Jag” XE saloon and F-Pace SUV as the company aims to reduce its reliance on the Land Rover marque.

During the quarter, JLR sold more than 100,000 Land Rovers for the first time – despite a 76pc increase in Jaguar sales.

Ralf Speth, chief executive, said: “This quarter’s sales reflect the positive customer response to the introduction of new vehicles, such as the XE in America. We have delivered volume growth in all of our major markets and remain solidly profitable.”
But their profits have fallen and so has the margins!

Quote:
However, profit before tax tumbled to £399m from £638m, and margin dropped 4.1 percentage points to 12.3pc.
http://www.telegraph.co.uk/business/...everse-as-inv/

That said JLR is facing a few challenges, 4 main ones in my opinion:

1. Profit margins - One of JLR biggest strengths was that almost their entire line up was made of big ticket items which contributed to very chunky margins. At 20% no other mainstream maker came close to this apart from Porsche maybe. But with the increasing sales of both the XE and the Discovery Sport the margins were bound to fall.

That said JLR's margins are far healthier than the German big 3, especially Audi which is hovering about 6%. But margins will be a challenge for JLR especially if DIsco SPort and XE sales continue to grow. Traditionally when selling an RR Sport or an F-type JLR dealers were able to push additional options into the purchase nearly doubling margins. But with the increasing fleet presence of XF, XE models and predominantly low option purchases of Disco Sports, this strategy takes a back seat.

A lot will depend on the impending launch of the next 3 models all of which are well prices. First the F-Pace, and if advance bookings are anything to go by JLR have an outright winner, provided they can meet demand. The waiting period of a custome spec model is now over 5 months. The XE and the F-Pace could multiple Jaguar sales over the next few months!

The all new Discovery. The present model sells more than 50k a year, and an all new Discovery will provide a major boost to the 12 year old Discovery.

Finally, the RR 'Velar' which is presently undergoing testing. Built on the iQ-Al (D7a) modular platform, it will be pitted against the X6 and GLE coupe, but will inevitably be far more expensive.

2. R&D + Manufacturing expenditure - Hybrids, electric powertrains, autonomous driving are all going to need a huge amount of moolah!! JLR has already finalized to invest £500 million into absorbing a 60-acre site just south of its existing buildings in Whitley. They are expected to create an estimated 2000 jobs from Whitley's expansion.

Then there is the 'Silverstone'project.

In addition to all this there is the £1.7 Billion plant that will come up in Slovakia. The factory will be responsible for producing the next generation of its 'affordable' line up including the Discovery Sport and next gen Defender. Then there is the Mexico factory as well.

3. China - The biggest challenge for all premium car makers. Not the golden child it once was, Govt. regulations, austerity, corruption crackdown, falling economy all means that luxury cars are not the flavour of the month. JLR just have made a massive investment there!! sales in China in July were up 64 percent on the same month last year.

But since the port explosion disaster JLR's China fortunes have turned around. In the first quarter of the calendar year (Jan-Mar) saw a 19% rise in volume in China. Their share of profit from its China JV reaching £50 million in the last quarter of its fiscal 2016. In July'16 sales in China were up 64 percent on the same month last year.

4. Pound's exchange rate.

Last edited by shortbread : 28th August 2016 at 17:29.
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Old 28th August 2016, 17:55   #18
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

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I wouldn't even trust a weather report published by ToI group! The only thing they do well of late is to provide Sunny Leonne updates!
My friend, you are correct and so is ET's report.

57% drop in consolidated net profits, and 91% drop in standalone net profits.

Quote:
During the quarter, all the segments of the company witnessed sales growth – M&HCVs grew by 7.8%, the LCV segment’s sales were up 11.6%, and the passenger vehicles segment grew by 6.3% with the car segment reporting a 15.1% rise on the back of a strong market response to the recently launched Tiago hatchback.

Sales (including exports) of commercial and passenger vehicles for the quarter ended June 30, 2016, stood at 126,839 units, representing a growth of 8.0%, as compared to the corresponding quarter last year.

Despite good volume growth, standalone profit fell 91% in the quarter to Rs 25.7 crore even as the net sales rose 10.2% to Rs 11,311 crore.
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Old 14th October 2016, 21:45   #19
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Tata Motors has crossed yet another notable landmark - it has leapfrogged Korea's Hyundai Motor Company to become the 2nd most valuable automaker in all of Asia, outside of Japan.

The market capitalisation of the domestic auto major has been pegged at $27.3 billion, which is just over Hyundai's $26.91 billion cap, according to data provided by Bloomberg Asia (as on October 7th, 2016).

China's SAIC Motor-A leads the Asian automaker's market cap lists at nearly $36 billion.

Also, it is of note that Tata Motors' market cap has jumped by over 50% in the past 12 months, which is the best performance by a Top 20-placed carmaker in global terms. Tata Motors is now ranked at number 13 in the global list of most valuable automakers, up from the 21st rank the company held about a year back.

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Maruti-Suzuki is placed at the 15th spot in the list, with a market cap value of $25.8 billion.

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Tata Motors is currently the 16th largest automaker globally in revenue terms with consolidated sales of $42 billion during the trailing twelve months ending June this year. In comparison, Hyundai Motors is world’s 11th biggest automaker with revenues of $81 billion, while China SAIC Motor is 8th biggest with revenues of $107 billion during the 12 months ended June this year. Their profits were also much higher than Tata Motors during the period.

Maruti Suzuki was the world’s 30th biggest automaker in terms of revenues and 25th largest in terms of profit during the trailing twelve months ending June this year. Toyota Motor Co tops the global league table with revenues and net profit of $240 billion and $19 billion respectively during the 12 months ending June this year.
G Chokkalingam, founder & CEO, Equinomics Research & Advisory:

Quote:
Indian automakers are among the most richly valued in the world right now and this reflects in their market capitalisation ranking. Part of this is due to Indian stock market being one of the most expensive globally, and the other being the growth premium that Indian companies currently enjoy over their global peers across sectors.”
Dhananjay Sinha, head-institutional equity, Emkay Global Financial Services:

Quote:
Tata Motors is as much a global company as many of its global peers. Its value is largely a function of its UK subsidiary Jaguar Land Rover’s performance, which is doing well in line with other global luxury carmakers. This gets reflected in Tata Motors’ stock price.
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Old 14th October 2016, 22:30   #20
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

GM & Hyundai are 2 companies having profits over 20 % to turnover , most of the other co's have 6-12 % . Wonder where does GM earn so much?
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Old 15th October 2016, 13:29   #21
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

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GM & Hyundai are 2 companies having profits over 20 % to turnover , most of the other co's have 6-12 % . Wonder where does GM earn so much?
No that's very wrong: they have much lower net profitability rates than that.

GM enoys 12%+margins only in the usa market, at these peaky current sales levels, largely on pickups and larger suv-s. It loses money hand over fist in both Europe and Latin America, for many a year now, but has continued huge and very profitable success in China (mulitple brands, including Buick, Cadillac and Baojun.)

Hyundai-Kia's margins are not as high anymore as you might think, and they've seen their profitability boom erode a lot over the last 2-4 years (currency revaluations, higher (e.g., labour) costs in Korea and the usa, higher costs for marketing and discounts/incentiuves, etc etc.) What they enjoy though is a quasi-soveriegn ultra-low cost-of-capital.
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Old 15th October 2016, 16:54   #22
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Wow! I'm astonished that Tesla has more market cap than Tata and Hyundai!
Is it because the stock market considers them the future? Or is it actually backed up by sales of that magnitude?
Now I know Tesla is selling a very good car at healthy numbers.
But the kind of numbers jlr and Hyundai must be notching up internationally must be so many times more!
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Old 15th October 2016, 20:28   #23
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

JLR profitability will be massively affected by the BREXIT ramifications, especially the utter collapse of the pound (Tata Motors is listed in rupees, and their models have a lot of imported from europe/usa components, esp Ford engines and ZF transmissions...)

One senses, also, that the Tata Motors share price actually discounts the domestic 'Tata' passenger car business, seeing it more as a 'hole in the balance sheet' than a potential profit-centre, foreseeably?! More rather than less so given the purported 3000crores commitment to all-new models (Zest, Tiago, Hexo, nexon and counting), new dealers etc etc! Of course, the share baazar thinks short-term, and necessarily misunderstands the future, so! They do greatly value Tata Motors' dominant share in the Indian commercial/truck space though.
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Old 15th October 2016, 21:25   #24
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

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JLR profitability will be massively affected by the BREXIT ramifications, especially the utter collapse of the pound (Tata Motors is listed in rupees, and their models have a lot of imported from europe/usa components, esp Ford engines and ZF transmissions...
JLR started making their own 4 cyl Ingenium engines and the 6 and 8 cylinder units are made in the UK as well. In addition while JLR has always been handicapped by the strength of the pound as compared to the german trio, the tables have turned for a change.

Also n the 'long term' they are strengthening their international manufacturing operations including the new plant in Slovakia.
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Old 15th October 2016, 21:47   #25
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Are the Ford 6 and 8cylinder engines that JLR uses made in the UK? Yes, i guess Ford's last manufacturing presence in the UK are engines. Thanks for the info.

The thing is: the devalued pound helps JLR in the short run, but screws things up for them, adding huge costs, once the real Brexit effects on tariffs etc with the eu comes into play. And they have a lot of imported from europe content.

Finally, unfortunately unlike the Germans or FCA, Tata Motors is listed and accounted for in rupees, while the others are in euros or dollars, the very currency of most of their costs and revenues. And so a hammered pound shows up, just via currency translation effects, very adversely on the Tata motors balance sheet, EVEN if JLR copes financially with the Brexit fallouts somewhat-well, no?
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