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Old 31st May 2016, 11:00   #1
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Default Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

- Exceptional performance by JLR, now becomes UK's largest car manufacturer overtaking NMUK (Nissan)

- Consolidated net profit rose to Rs.5,177 crore during the March quarter, up 201% from Rs.1,716.5 crore a year ago. Net sales rose 18.76% to Rs.79,926.12 crore from a year ago. The profit was the highest in seven quarters.

- During the period, JLR sold a total of 158,213 units, up 28% over the year-ago period. For the full year that ended in March, the maker retailed 521,571 units, up 13% over a year ago.

- JLR sales rising 29% across its markets, from 28% in the UK to 23% in North America to 19% in China and 54% in Europe.

- Meanwhile, after incurring losses for several quarters, the domestic operations of the company turned in a profit on the back of higher demand for medium- and heavy-duty trucks. Sales of such vehicles rose 26% in the quarter over a year ago. The domestic business turned profitable in Q4, with net profit rising to Rs 465 crore versus a loss of Rs 1,164 crore a year ago.

- Increased sales of lower priced models including Discovery Sport and XE have lowered JLR margins. Research and development budget has been increased, which will be 3.75bn this year compared with 3.14bn last year.

sources:

http://www.livemint.com/Companies/uO...-JLR-Euro.html

http://www.ft.com/cms/s/0/317cc2ca-2...#axzz4ACsjYkzs

http://profit.ndtv.com/news/market/a...o-know-1413793
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Old 31st May 2016, 11:06   #2
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Default re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Kudos to them. JLR is doing great.

And the numbers for this quarter was helped by an insurance payment as well.

Quote:
Originally Posted by Hindu
Profit was helped by a one-time gain of Rs.555 crore in an insurance payment for damage caused to JLR cars in an explosion at Tianjin Port in China last year.
Tata Motors Q4 profit triples
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Old 31st May 2016, 11:23   #3
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Default re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Looks like the insurance payment and JLR helped achieve this feat. Not much from sales/performance of Indian models?
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Old 31st May 2016, 11:27   #4
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Default re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Even considering the insurance payout, the profit has increased considerably. I am pretty sure they are going to do even better with the F-Pace launch.
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Old 31st May 2016, 11:32   #5
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Default re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

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Originally Posted by centaur View Post
Looks like the insurance payment and JLR helped achieve this feat. Not much from sales/performance of Indian models?
There is no doubt that when it comes to car sales Tata has a huge mountain to climb. That said it's a common misunderstanding that Tata relies on its car sales for survival.

Tata Motor's biggest domestic money maker is its commercial vehicle division and is numero uno in India. Tata is to trucks and buses what Maruti is to cars.

Quote:
Meanwhile, after incurring losses for several quarters, the domestic operations of the company turned in a profit on the back of higher demand for medium- and heavy-duty trucks. Sales of such vehicles rose 26% in the quarter over a year ago. The domestic business turned profitable in Q4, with net profit rising to Rs 465 crore versus a loss of Rs 1,164 crore a year ago.
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Old 31st May 2016, 11:41   #6
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Default re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Quote:
Originally Posted by shortbread View Post
- Meanwhile, after incurring losses for several quarters, the domestic operations of the company turned in a profit on the back of higher demand for medium- and heavy-duty trucks. Sales of such vehicles rose 26% in the quarter over a year ago. The domestic business turned profitable in Q4, with net profit rising to Rs 465 crore versus a loss of Rs 1,164 crore a year ago.
Is this a firm indicator of robustness in the economy aka acche din? Tata's performance would be indicative of the broad market growth and would not be at the singular expense of all other players.
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Old 31st May 2016, 11:41   #7
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Default re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

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Originally Posted by shortbread View Post
That said it's a common misunderstanding that Tata relies on its car sales for survival.
Absolutely not. The reason I mentioned that is because the article majorly spoke about JLR and the impact its sales had on the profits. So just wanted to know how much impact did the Indian car sales have on it or can this be totally attributed to JLR and the insurance part.

Quote:
Originally Posted by shortbread View Post
Tata Motor's biggest domestic money maker is its commercial vehicle division and is numero uno in India. Tata is to trucks and buses what Maruti is to cars.
This is true but even in this segment they were incurring losses if I am not mistaken
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Old 31st May 2016, 11:55   #8
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Default re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

The profit for the domestic unit has also increased. in fact they has posted a loss last year

"What is more important is the remarkable turnaround of its domestic unit which has been struggling for the past many years. On a standalone basis, Tata Motors India reported a net profit of Rs 465 crore for the fourth quarter against a net loss of Rs 1,164.25 crore a year ago.

Standalone net sales stood at Rs 12,459.51 crore against Rs 10,676.19 crore, driven primarily by truck and bus business and partly by the demand for its new cars - the Bolt, Zest and the new Nano. "


Read more at:
http://economictimes.indiatimes.com/...campaign=cppst
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Old 31st May 2016, 12:01   #9
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Default re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Quote:
Originally Posted by shortbread View Post
Tata Motor's biggest domestic money maker is its commercial vehicle division and is numero uno in India. Tata is to trucks and buses what Maruti is to cars.
Maruti would love to have a market share in passenger cars segment, like TML has in the commercial vehicles segment. Last I heard, Maruti's market share in passenger cars was just shy of 50% (from the April 2016 sales thread), while TML's market share in commercial vehicles was more than 60%.

I am glad I held on to my TML shares!

Cheers,
Vikram
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Old 31st May 2016, 14:00   #10
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Quote:
Originally Posted by shortbread View Post
Tata is to trucks and buses what Maruti is to cars.
Well said . And with a per unit volume that is 10x higher.

Quote:
Originally Posted by centaur View Post
Not much from sales/performance of Indian models?
As a standalone, Tata's Indian passenger car division has perhaps made another loss, as it has been for a while now.

Just wish Tata focussed more on profitable UVs the same way that it has started on passenger cars. There is a lot of opportunity in the SUV & MUV segment. While Tata can create magic with monocoque-based UVs, the field is wide open in the body-on-frame sector as few international players venture there. Cars like the Bolero & Scorpio are enjoying a free run! It'll be easier to fight a Mahindra UV than a Maruti / Hyundai / MNC hatchback.
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Old 31st May 2016, 15:16   #11
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

I think it is high time Tata think of their product strategy for their passenger vehicles. None of the older lot are doing well and in the last year they have climbed down a couple of notches. Maybe it is time that they focus energies on culling out the right market. The UV segment doesnt have much except for Mahindra and the Tata Xenon. Isuzu is slowly coming into this with DMAX. But if Tata can pick up the thread here and focus on a few models in the UV segement, that would look like a winner

What about trailers ? and for all you know Caravans ?? Maybe time to open up that market as well
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Old 31st May 2016, 15:54   #12
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Tale of two British companies! One (Corus Steel) was a bane and the other (Jaguar Land Rover) a boon for Tatas. JLR sure is riding very high right now. I would like to see more JLR cars on our roads than German trio.

Last edited by GTO : 1st June 2016 at 13:06. Reason: Typo
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Old 1st June 2016, 11:20   #13
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Quote:
Originally Posted by GTO View Post

Just wish Tata focussed more on profitable UVs the same way that it has started on passenger cars. There is a lot of opportunity in the SUV & MUV segment. While Tata can create magic with monocoque-based UVs, the field is wide open in the body-on-frame sector as few international players venture there. Cars like the Bolero & Scorpio are enjoying a free run! It'll be easier to fight a Mahindra UV than a Maruti / Hyundai / MNC hatchback.
Very true, theres still room for more competition in the body-on-frame sector. A far more polished and 'safer' product than the jugaads presently being sold. Such a platform can create models for global sales, as the Toyota IMV models prove (Hilux, Fortuner etc...)

It will be interesting to see what the next iteration of Land Rover's Defender will be and whether this will have any implications on Tata's UV line up.

Rest assured JLR will continue to rake in the moolah, full scale sales of the new XE and XF in the US, upcoming launches of the F Pace, Evoque convertible, updated F Type with the new Ingenium petrol engines (2 litre 300bhp rumoured). Also in development are the all new Evoque, smaller Jag SUV and another new Range Rover model.
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Old 1st June 2016, 11:35   #14
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Quote:
Originally Posted by GTO View Post
the field is wide open in the body-on-frame sector as few international players venture there. Cars like the Bolero & Scorpio are enjoying a free run! It'll be easier to fight a Mahindra UV than a Maruti / Hyundai / MNC hatchback.
So true - with their new found focus on providing class leading quality in their offerings, they can take the fight to M&M against their alphabetically named UV contraptions in the compact SUV segment. Hope they bring our a shortened Hexa/Storme chassis
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Old 1st June 2016, 17:11   #15
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Default Re: Q1 2016: Thanks to Jaguar-Land Rover, Tata Motors profits triple!

Brilliant article in Bloomberg: "The Jaguar That Ate Tata". It shows how the JLR buy has thought to be a mistake by many, but how it has turned out instead.
Quote:
When India's Tata Motors bought Jaguar and Land Rover from Ford in 2008, many investors thought then-Chairman Ratan Tata was making a big mistake.
Ford was selling the units for less than half what it paid to acquire them, just as early tremors of the credit crisis began sapping luxury demand. The day before the deal was announced on Jan. 3, 2008, West Texas Intermediate crude reached $100 a barrel for the first time, suggesting a tough environment for gas-guzzling sports cars and four-wheel drives.

Tata's Nano, a super-cheap "one lakh rupee'' ($1,500) minicar pitched at India's emerging middle class, was seen as the best prospect, and Jaguar Land Rover looked like an expensive distraction. Moody's and S&P both downgraded Tata Motors, and the stock fell almost 30 percent in the six months it took to complete the transaction.

How have those prognostications turned out?
Wrong on almost every count. Jaguar Land Rover now accounts for more than half of Tata Motors' unit sales, overtaking the trucks and passenger cars produced by Tata Motors India in the past two quarters, according to annual results released Monday.
One should see the full article to see the charts and data points that they have compiled.
On the road ahead for Tata:
Quote:
What should Ratan Tata's successor Cyrus Mistry do about this situation? One option sure to delight investors would be selling the legacy Tata business to focus entirely on Jaguar Land Rover, as canvassed by Gadfly's Andy Mukherjee in March. The problem there is finding a buyer for an unprofitable arm that's also more indebted than its upmarket stablemate.

A better idea would be to make the best of a bad job and work at applying lessons learned from the British business. As Nissan has shown since its 1999 alliance with Renault, troubled carmakers are often only a few blockbusting designs away from success. Many investors nowadays regard Tata Motors India as an irredeemable basket case that's lurched from one crisis to another for decades. They thought the same thing of Jaguar Land Rover eight years ago.
Source: http://www.bloomberg.com/gadfly/arti...-that-ate-tata

Last edited by jetti : 1st June 2016 at 17:12.
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