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Originally Posted by RavenAvi 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.
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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.”
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But their profits have fallen and so has the margins!
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However, profit before tax tumbled to £399m from £638m, and margin dropped 4.1 percentage points to 12.3pc.
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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.