Tata Group Stock In Focus: Tata's 79-Yr-Old Co's Q4 Net Jumps 107% To Rs 17,407 Cr; JLR Bags Highest Revenue

Auto giant, Tata Motors posted strong earnings in Q4FY24 and the full fiscal year. The Tata Group-backed top auto player bagged a consolidated net profit of Rs 17,407.18 crore in Q4FY24, rising by 107.4% YoY. Also, Tata Motors' consolidated revenue jumped by 13.51% YoY to Rs 119,213.35 crore. Its luxury car brand, Jaguar Land Rover (JLR) posted record revenue and sales.

For the full fiscal year, Tata Motors reported record revenues of Rs 437.9K Cr, an all-time high EBITDA at Rs 62.8K Cr, the highest ever PBT (bei) of Rs 28.9K Cr (+Rs 27.1K Cr over the previous year) and net profit of Rs 31.8K Cr (+Rs 29.1K Cr over the previous year). The strong performance has also helped to recognize a Deferred Tax Asset of Rs 8.3K Cr at JLR and TML.

PB Balaji, Group Chief Financial Officer, Tata Motors said, "It is pleasing to report the FY24 results during which Tata Motors Group delivered its highest ever revenues, profits, and free cash flows. The India business is now debt-free, and we are on track to become net automotive debt-free on a consolidated basis in FY25. The businesses are executing well on their distinct strategies and therefore, we are confident of sustaining this strong performance in the coming years."

While JLR continued its strong financial performance trend in the financial year, with another record-breaking quarter in Q4 FY24. Revenue for the quarter was £7.9 billion, up 11% versus Q4 FY23 and up 6% versus Q3 FY24. Revenues for FY24 were £29.0 billion - JLR's highest-ever full-year revenue and up 27% compared to the prior year.

For JLR, Adrian Mardell, JLR Chief Executive Officer said, "This has been a year of great strategic progress at JLR and I would like to thank our clients, our people, our suppliers and partners for their role in our success. We have delivered a record financial performance for the company, generating free cash flow of £2.3 billion, enabling us to reduce net debt to £0.7 billion."

Mardell added, "The foundation of this performance was the sustained global demand for our modern luxury vehicles, led by our Range Rover and Defender brands, underpinned by a consistent focus on operational improvement. We are entering the next exciting phase of our Reimagine strategy which will see us bring to life our modern luxury electric vehicles and deliver an accompanying modern luxury experience for our clients, ensuring we continue to vigorously address the challenges we have encountered in 2024."

Furthermore, Tata Motors is set to split into two listed entities namely commercial vehicles business and passenger vehicles business.

In Q4 FY24, domestic wholesale CV volumes were 104.6K units, lower by 7% yoy on account of increased pre-buy in Q4 FY23 due to the BS6 Phase II transition. Exports were at 4.5K units increasing 13% yoy. However, revenues improved by 1.6% yoy to Rs 21.6K Cr on account of improved pricing and lower VMEs. EBITDA and EBIT margins of 12.0% (up 190 bps yoy) and 9.6% (up 100 bps yoy), respectively were delivered. For the full year, while overall volumes declined by 4%, HCV volumes increased by 5%.

In Q4, PV volumes were at 155.6K units (+14.8% yoy)supported by new SUV facelifts and multiple power trains. Nexon continued to be the highest-selling SUV in FY24 and along with the Punch was among the top 5 models sold in India. Revenues in Q4 were up 19% yoy at Rs 14.4K Cr, while EBIT margins improved by 150 bps yoy to 2.9% owing to operating leverage on improved volumes and savings in commodity costs. In Q4, the PV (ICE) business delivered double-digit EBITDA margins and the EV business was EBITDA positive (before R&D spending) at 1.1%. On a full-year basis, the PV business delivered ~9% revenue growth and the highest ever PBT (bei) at Rs 1.4K Cr (+Rs 0.7K Cr yoy).

Tata Motors has also declared a final dividend of Rs 3/- per Ordinary Share and Rs 3.10 per Ordinary Share and a special dividend of Rs 3/- per Ordinary Share and Rs 3.10 per Ordinary Share subject to approval by the shareholders.

Going forward, Tata Motors said they remain cautiously optimistic about domestic demand over the full year and expect H1 to be relatively weaker. The premium luxury segment demand is likely to remain resilient despite emerging concerns about overall demand. Despite this, Tata Motors is confident of delivering a strong performance in FY25.

In the case of JLR, Tata Motors said, "We will continue to focus on brand activation to maintain the order book. We expect EBIT margins in FY25 to be around the FY24 level. We anticipate a modest increase in investment spend to £3.5b but still expect to become net debt zero during FY25."