With the gradual improvement in availability of semiconductors and the stabilising of commodity prices, Tata Motors Chairman N Chandrasekaran is expecting the second half of the current financial year to be better than the first.

“We continue to work closely with our customers and ecosystem partners to mitigate risks and manage uncertainties. Accordingly, we expect performance to progressively improve through the year with the second half of FY23 being notably better than the first half,” Chandrasekaran said at the company’s 77th annual general meeting (AGM) conducted virtually.

FY22 performance

In FY22, the company’s global wholesales increased by 20 per cent to 10,86,734 vehicles and revenue stood at around ₹2.78-lakh crore, which was 11.5 per cent higher as compared to FY21. EBIT margin stood at 0.7 per cent, 190 bps lower as compared to FY21 due to the impact of commodity inflation and semiconductor shortages.

Free cash flow (automotive) in the year, was negative at ₹9,472 crore (as compared to positive ₹5,317 crore in FY21), primarily due to adverse working capital. However, the business showed strong sequential recovery with positive free cash flow (automotive) of ₹11,916 crore in the second half of FY22. “We are committed to restoring the profitability of this business as it returns to competitive growth and inflation stabilises,” Chandrasekaran added.

Near zero net debt

Tata Motors also formed two new subsidiaries — Tata Passenger Electric Mobility and Tata Motors Passenger — in FY22. The company has three independent business units, comprising commercial vehicles, passenger vehicles and Jaguar Land Rover.

“This has made your company leaner, nimbler and more customer centric. Each of these businesses are now self-sustaining which gives me greater confidence to reiterate that we will get to near zero net automotive debt by FY24, a timeline I had announced/committed in my address at the last AGM,” Chandrasekaran added.