Tata Motors has recently unveiled its financial performance for the March quarter of 2025, revealing significant shifts in its profit margins. The automaker reported a 51.34% year-on-year decline in consolidated net profit, totaling ₹8,470 crore, a stark contrast to ₹17,407 crore from the previous year. Despite this drop, Tata Motors saw a slight increase in revenue, which climbed by 0.4% to reach ₹1,19,502 crore.

Key Financial Insights for Q4 FY25

• EBITDA experienced a downturn, falling 4.1% year-on-year to ₹16,700 crore.
• The EBITDA margin also saw a reduction of 60 basis points, settling at 14%.

In terms of annual performance, FY25 marked a milestone for Tata Motors, reporting record revenues of ₹4,39,695 crore, up by 1.3% from the previous year. However, profit took a hit, decreasing by 11.4% to ₹27,830 crore.

Strong Cash Position and Strategic Outlook

One bright spot in Tata Motors’ report is that the company achieved a net cash positive status in FY25, ending the year with a net cash balance of ₹1,000 crore. The firm’s leadership attributed this success to reduced depreciation and amortization at Jaguar Land Rover (JLR), improved profitability in commercial vehicles, and savings on interest costs. However, these positives were somewhat offset by lower volumes and diminished operating leverage.

PB Balaji, the Group Chief Financial Officer, emphasized the resilience of Tata Motors, stating, “Despite facing external challenges, we have maintained strong performance in FY25, achieving our highest-ever revenues and profit before taxes. Our automotive division is now debt-free, which significantly lowers our interest expenses.” Balaji also noted that the company is committed to remaining agile and proactive in its growth strategy, particularly in light of ongoing uncertainties in the market.

Dividend Announcement for Shareholders

In a move to reward shareholders, Tata Motors has proposed a final dividend of ₹6 per equity share for FY25. The board of directors has recommended this dividend, which, pending approval at the upcoming AGM, will be distributed to eligible shareholders by June 24, 2025.

Segment Performance Overview: Jaguar Land Rover

Focusing on the JLR segment, the revenue for Q4 FY25 stood at £7.7 billion, reflecting a 1.7% decline year-on-year. The EBITDA margin for JLR decreased by 100 basis points to 15.3%. Notably, wholesales for the Defender reached a record 115,404 units in FY25, while sales of the Range Rover Sport surged by 19.7%.

JLR reported a profit before tax of £875 million for Q4, up from £661 million in the same quarter last year. The full-year profit before tax hit £2.5 billion, marking a 15% increase and the highest in a decade.

Conclusion

As Tata Motors navigates a complex global landscape filled with geopolitical challenges and fluctuating market conditions, its strategic focus on growth and financial stability remains evident. With plans for a potential demerger and an optimistic outlook for both the luxury segment and domestic markets, the company appears poised for future success. For ongoing updates, stay tuned as this story develops.