Tata Motors share price was trading lower ahead of the auto maker's Q2 earnings announcement today. Tata Motors share price fell up to 4.5% to Rs 127.5 compared to previous close of Rs 133.45 on BSE. At 2:13 pm, the large cap stock was trading 3.93% lower at Rs 128.20 and was among the top losers on Sensex.
On NSE, Tata Motors share price lost 4% to Rs 128.15. Tata Motors share has fallen after two sessions of gain. It has lost 22.76% during the last one year and fallen 26% since the beginning of this year.
The Tata Group firm's Q2 earnings are seen subdued on weakness in JLR sales overseas and dismal domestic performance at home. Motilal Oswal Securities estimates the firm's consolidated revenue to decline 12.3% year-on-year (YoY), resulting in a net loss of Rs 1480 crore (against Rs 560 crore loss in Q2FY19 and loss of Rs 3,600 crore in Q1FY20).
The brokerage expects Jaguar Land Rover's net realisation to increase 3.2% YoY, and on a standalone business, it estimates EBIDTA margin to decline to 2.2%, and a net loss of Rs 610 crore (against Rs 190 crore net profit in Q2FY19).
Sharekhan sees the company reporting Rs 1,476-crore loss for quarter ended September period. Consolidated revenues seen to falling by 3 per cent YoY. JLR revenues may rise 4 per cent while that of the Indian operations are seen falling 47 per cent YoY, the brokerage firm said in its report.
"Operating margins are expected to contract 400 bps YoY as OPM's at Jaguar Land Rover likely to reduce 210 bps. The standalone margins are expected to fall 680 bps YoY following negative operating leverage. EBITDA (Earnings before interest, tax, depreciation, and amortisation) is expected to decline sharply by 44 per cent," Sharekhan said in a note.
In the first quarter of current fiscal, Tata Motors reported a consolidated net loss of Rs 3,679.66 crore dented by muted volume growth in domestic business as well as in its British arm Jaguar Land Rover (JLR). "The company had posted consolidated net loss of Rs 1,862.57 crore in June quarter of 2018 and profit of Rs 1,117.48 crore in March quarter 2019," Tata Motors said.
The company said profit was impacted by demand slowdown, higher axle loads, liquidity stress, low freight availability for cargo operators. Consolidated revenue declined by 7.84 per cent to Rs 61,467 crore as compared to Rs 67,701 crore in the year-ago period. Operating profit, or EBITDA (earnings before interest, tax, depreciation and amortisation) dipped 130 basis points (bps) YoY to 6.2 per cent, while EBIT margin plunged 170 bps to a negative 2.5 per cent.
By Aseem Thapliyal