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Tata Motors expects slow start to FY25 PV sales amid elections

Tata Motors expects slow start to FY25 PV sales amid elections

India Blooms news Service | @indiablooms | 12 May 2024, 04:27 pm

Mumbai: Auto giant Tata Motors has said it expects a slow FY25 beginning due to a drop in probable local passenger vehicle (PV) demand during the ongoing Lok Sabha elections, media reports said.

"We see that the industry will moderate and grow less than 5 percent, given that the pent-up demand has exhausted, the channel inventory is high and in the first quarter, we will face certain factors like that of elections to dampen the demand for temporary for quarter one," Shailesh Chandra, managing director of Tata Motors' passenger vehicle said in a post-result earnings call, Moneycontrol reported.

Although the general outlook for passenger vehicle demand appears subdued, Tata Motors suggests that the premium luxury segment is set to retain its strength.

According to data from the Federation of Automobile Dealers Associations (FADA), in April, sales of passenger vehicles saw a modest 4 percent increase month-on-month, reaching 3,35,123 units.

However, continued challenges such as competition, surplus supply, and aggressive discounting create obstacles for persistent growth, FADA said.

The wholly-owned subsidiary of the company, Jaguar Land Rover (JLR), has reported yet another outstanding quarter.

JLR's revenue surged to 7.9 billion pounds, marking an 11 percent increase compared to Q4 FY23 and a six percent rise compared to Q3 FY24.

JLR's revenues for the entire FY24 also reached 29.0 billion pounds, a 27 percent surge compared to the previous year.

The British subsidiary anticipates its earnings before interest and taxes (EBIT) margins in fiscal 2025 to be approximately 8.5 percent, consistent with the previous fiscal year.

The company announced on May 10 that it has been conducting tests on the upcoming electric Range Rover in extreme conditions in the Arctic Circle and Middle Eastern deserts, with plans to launch the electric version later this year.

The waitlist for the electric Range Rover opened in December last year, and JLR asserts it has already received over 28,700 sign-ups for the model.

During the fourth quarter, Tata Motors achieved a substantial 222 percent increase in its consolidated net profit, reaching Rs 17,407.18 crore. This growth was attributed to enhanced operating leverage, favourable commodity prices, and robust volume growth across various segments.

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