Stocks

Tata Motors tanks 8% on lower JLR margins

PTI Mumbai | Updated on November 15, 2017

Shares of Tata Motors got battered today because of lower Jaguar Land Rover (JLR) margins even as the company posted over two-fold jump in consolidated net profit at Rs 6,234 crore for the quarter ended March 31, 2012.

The standalone numbers were disappointing with the net profit sliding 1.4 per cent to Rs 565 crore from Rs 573 crore.

The stock tanked as much as 8.73 per cent to an early low of Rs 251.80 on the BSE and was the biggest drag on the BSE 30-share sensitive index Sensex.

On the National Stock Exchange, the stock fell to an early low of Rs 137.50, down by over 11.08 per cent and was also the biggest loser on the broad-based Nifty.

Experts said Tata Motors’ March quarter earnings were in line with market expectations, but JLR margin was lower than estimates resulting in the massive slide.

Besides, JLR profit was aided by a one-time income by way of deferred tax gains worth £217 million or around Rs 1,888 crore during the quarter.

“In the March quarter, the JLR models disappointed on the margins front. Margins in the quarter under review grew over 14 per cent against the market expectation of over 18 per cent,” Ashika Stock Brokers’ Research Head, Mr Paras Bothra, said. The weak EBITDA margin was mainly driven by higher other expenses, he added.

In the January-March period, JLR reported an over two-fold rise in net income at £696 million (over Rs 6,000 crore) from £262 million (over Rs 2,380 crore) from the same period last year.

Published on May 30, 2012

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