Tata Motors Share Price Tumbled 7%: PAT Fell Over 22% in Q3FY25

On January 30, 2025, Tata Motors share price fell ~7%, reaching a day low of ₹684.25, after opening at ₹715.00. The fall in Tata Motors share price came after the company released its results for Q3FY25, revealing a 22.5% decline in consolidated net profit to ₹5,578 crore, down from ₹7,415 crore in the same period last year.

Sequentially, the company saw a 62% improvement in profit, with net profit rising from ₹3,450 crore in the September quarter. Revenue for the quarter stood at ₹113,575 crore, reflecting a modest 2.7% increase compared to ₹109,799 crore in Q3FY24.

On the operating front, EBITDA dropped by 14.7% YoY to ₹13,081 crore, compared to ₹15,333 crore in the same quarter last year. EBITDA margins also fell by 60 basis points, reaching 13.7%.

JLR delivered a solid performance, posting record quarterly revenue, the highest EBIT margin in a decade, and marking its 9th consecutive profitable quarter. Meanwhile, Commercial Vehicle (CV) revenues declined due to lower volumes and product mix. Passenger Vehicle (PV) volumes remained stable at 140,000 units for the quarter.

In December 2024, Tata Motors received approval for the Automotive Production Linked Incentive (PLI), resulting in an income recognition of ₹351 crore.

JLR Performance

JLR showed strong results in Q3 FY25, achieving record revenue of £7.5 billion, a 1.5% increase YoY, and the highest EBIT margin in 10 years. However, its EBITDA margin contracted by 200 basis points YoY, to 14.2%. Despite the challenges, the company remains optimistic about achieving its FY25 profitability and cash flow targets, with an EBIT margin goal of at least 8.5% and maintaining positive net cash.

Commercial and Passenger Vehicle Segment

In the Commercial Vehicle segment, revenue dropped by 8.4% YoY to ₹18,431 crore. However, EBITDA margins improved to 12.4%, up 130 basis points YoY, driven by commodity cost savings and PLI incentives (90 basis points). On a year-to-date basis, the CV business delivered an EBITDA margin of 11.6%, up 120 basis points YoY.

Passenger Vehicle revenue stood at ₹12,354 crore, down 4.3% YoY, but EBITDA margins improved to 7.8%, up 120 basis points YoY, driven by cost-reduction measures and incentives that offset adverse realizations, according to the earnings report.

Tata Motors’ Outlook

Looking ahead, Tata Motors expects domestic demand to gradually improve, driven by increased infrastructure spending, a series of exciting product launches, and stable interest rates. While JLR wholesales are anticipated to rise further in Q4 FY25, the company remains cautious about the overall demand environment, especially in China.

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