On May 12, 2023, Tata Motors, the Indian multinational automotive manufacturing company, released their financial results for the March quarter. The company declared a consolidated profit of Rs. 5,408 crore for the quarter, a stark contrast to the deficit of Rs. 1,033 crore reported during the same period last year. This positive development was attributed to strong demand in India and improved supply at JLR, leading to continuing volume improvements.
The business also disclosed that its board of directors has recommended a final dividend of Rs. 2 per ordinary share and Rs. 2.1 per share for DVR shareholders, subject to approval by the shareholders at the annual general meeting (AGM). This marks the company’s first dividend announcement in seven years, as Tata Motors hadn’t declared a dividend since FY16.
Total operating income was reported at Rs. 10,5932.35 crore, a 35% increase from Rs. 78,439.06 crore in the same period last year. Both the top and bottom lines of the company exceeded experts’ predictions, as Tata Motors was expected to report a combined net profit of Rs. 2,550 crore, according to ZED Business Research. In comparison, the company reported an unusual loss of Rs. 714 crore in the previous year. Revenue for the fourth quarter of FY23 at Tata Motors was also predicted to increase by 23.7% YoY to Rs. 97,000 crore from Rs. 78,439 crore in the previous quarter. On a YoY basis, margins were predicted to increase to 11.5 percent from 11.1 percent.
In its results announcement, the company stated that the Q4 FY23 was one of the strongest quarters for TML Group, with consolidated sales of Rs. 105.9K crore, EBITDA of Rs. 14.1K crore, PBT (bei) of Rs. 5.0K crore, and a decrease in net auto debt of Rs. 13.8K crore. Better average selling prices (ASPs) and faster revenue growth were the results of pricing decisions and a more varied product mix. Strong gains in margins and profits were made as a consequence of easing inflation, a stronger mix, price decisions, and positive operational leverage.
Overall, the Q4 FY23 financial results of Tata Motors are a promising indication of the company’s growth trajectory. The auto manufacturer’s consolidated profit and total operating income have both increased significantly, while the recommendation of a dividend payment is likely to be well-received by shareholders. With strong demand in India and improved supply at JLR, Tata Motors is well-positioned for continued success in the future.
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