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Tata Motors profit slumps on slow UK car sales

MUMBAI, November 15, 2014

India's Tata Motors reported a surprise drop in quarterly net profit yesterday, hit by slowing sales at its British luxury subsidiary and higher taxes.

Consolidated net profit slipped to Rs32.91 billion ($533.82 million) in the three-months-to-September from Rs35.42 billion a year ago.

The earnings of Tata Motors, part of the sprawling Tata tea-to-steel conglomerate, significantly undershot a consensus market profit forecast of Rs46.2 billion.

'We had an unexpected reversal of tax credits in the quarter... and there are costs related to high investment going into JLR (Jaguar Land Rover),' C Ramakrishnan, president and chief financial officer, said.

Consolidated revenue rose 6.5 per cent to Rs605.64 billion in the three-months-to-September from a year earlier.

The Mumbai-based firm's tax bill totalled Rs7.38 billion, a reversal of the company's tax credit earnings of Rs1.8 billion rupees in same period a year ago.

Losses at Tata's Indian operations swelled nearly 130 per cent to Rs18.46 billion.

There was also a profit fall at Tata's British luxury marque JLR unit, the firm said.

Net profits at JLR shrank to £450 million ($704.86 million) in the quarter from £507 million in the same year-ago period even though sales of the premium brand grew eight per cent.

Tata Motors is now hugely reliant on the revenues from JLR, which it bought for $2.3 billion from Ford in 2008 at the height of the global financial crisis.-Reuters
 




Tags: profit | Tata Motors | British car |

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