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Indian Automobile Manufacturing Firm Tata Motors Q1 Net Loss Narrows 

The company said that Covid-19 slowed down the growth of the company.

MUMBAI, India — Tata Motors announced that its first-quarter consolidated net loss narrowed on a sequential and year-on-year basis to INR 4,451 crore ($597.5 million) in the quarter ended June 2021. The net loss for Q1 last year was INR 8,438 crore ($1.13 billion).

At the same time, revenue from operations in the first quarter more than doubled to INR 66,406 crore ($8.91 billion) as against INR 31,983 crore ($4.29 billion) in the year-ago period.

The company’s earnings before interest, depreciation and amortization (EBITDA) came in at INR 5,500 crore ($738.3 million).

The topline performance was largely aided by the benefit of a low base in the year-ago quarter, which was marred by lockdowns in several global markets and a national lockdown in India to contain the spread of the Covid-19 pandemic.

“Despite the spread of the Delta variant, the continued increase in Covid-19 vaccination rates is encouraging for the ultimate recovery of the global economy and automotive industry,” the company said in a press release.

“The shortage of semiconductors is presently very dynamic and difficult to forecast. Jaguar Land Rover expects the situation will start to improve in the second half of the financial year.”

India’s operations showed significant improvement as compared to the first quarter a year ago, but the second Covid wave in India, along with the supply issues, slowed down the growth momentum.

The electric vehicle business, however, continued to grow rapidly and delivered 5x revenue growth and the highest quarterly sales at 1,715 units, said Tata Motors.

“Looking beyond the short-term challenges, we see significant opportunities to leverage the megatrends shaping the Indian automotive industry. We are working to transform the customer experience digitally and also strengthen our leadership in sustainable mobility,” said Executive Director of Tata Motors Girish Wagh.

“We will continue to make the requisite investments to ensure a competitive product portfolio while driving down the cash breakevens of the business to deliver consistent, competitive, and cash accretive growth over the medium to long term.”

“As at March 31, 2020, the Company had assessed the recoverable value of Passenger vehicle business of Tata Motors Limited on standalone basis, which represents a single cash-generating unit (CGU), due to refresh of its strategy in response to change in market conditions on account of various factors (economic environment, demand forecasts, etc.) including Covid-19 pandemic,” the company said in its standalone results.

On the other hand, Jaguar Land Rover‘s (JLR) retail sales in the first quarter were 124,537 vehicles, up 68.1 percent year-on-year. The company said a shortage of semiconductor supplies constrained production.

“Though the current environment continues to remain challenging, we will continue to adapt and manage elements that are within our control and ensure that Jaguar Land Rover is well-placed to respond to any further market developments,” said Chief Executive Officer of Jaguar Land Rover Thierry Bollore.

“We remain encouraged by the sheer strength of the demand for our vehicles, and note the success of our electrified powertrain offering as we work to drive that demand further by reimagining our iconic British brands for a future of modern luxury by design.”

(With inputs from ANI)

Edited by Abinaya Vijayaraghavan and Praveen Pramod Tewari