TMPV Q2 results: Price hikes to aid sales growth; eyes on commodity price inflation

Tata Motors Passenger Vehicles Ltd (TMPV) is likely to report a consolidated net profit of Rs 1,810 crore for the September quarter, a Bloomberg median estimate of eight analysts suggests. Revenue is estimated at Rs 1 lakh crore, according to the median estimate of 17 analysts. Ebitda is estimated at Rs 6,973 crore, while gross margin is seen at Rs 36.49 per cent.

Finance cost is estimated at Rs 702 crore, while parent sales are estimated at Rs 20,224 crore, the consensus data showed.

MOFSL noted that India PV outperformed the industry with strong 48 per cent year-on-year (YoY) growth, fuelled by new launches of Sierra and Punch EV.

However, it expects a 160 basis points YoY contraction in margins due to commodity price pressure and a higher EV mix. At JLR, wholesales grew 25 per cent as volumes were impacted in the year-ago period by a cyberattack.

"Coupled with an improvement in realisation, we expect revenue to grow 27 per cent YoY. However, commodity inflation is expected to keep margins under pressure at 6.3 per cent (down 180 bps quarter-on-quarter (QoQ))," it said, while estimating profit at Rs 439.30 crore.

In the case of JLR, the TMPV arm recently highlighted that conditions in China remained challenging, while the Middle East continued to face disruptions due to the ongoing geopolitical conflict, impacting wholesales QoQ. However, retails indicated strong underlying demand. Wholesale volumes improved significantly YoY, reflecting a recovery from the cyber incident last year.

"While 2QFY27 wholesale volumes have seen improvement, underlying demand continues to be weak, as retails are lower than wholesales. China remains weak, while US demand has remained relatively stable. Success of new launches remains a key monitorable for JLR, along with its transition of the Jaguar portfolio," Nomura said on JLR.

For Q2, it estimated JLR's revenue at 6.1 billion pounds and average selling price at 74,500 pounds for 2QFY27F.

"EBIT margins for 2QFY27F are estimated at 2.6 per cent, while we expect free cash flow (FCF) to be breakeven. For FY27F, we estimate volumes (excluding the China joint venture) of 358,000, 372,000 and 382,000 units over FY27-FY29F. We estimate JLR's EBIT margins at 4.5 per cent, 5.5 per cent and 5.9 per cent for FY27F, FY28F and FY29F, respectively. For FY27F, we expect FCF of GBP204 million," it said.

ICICI Securities sees TMPV's consolidated profit at Rs 2,006 crore and revenue at Rs 99,914 crore.

"We expect domestic PV revenue to grow 11.5 per cent QoQ, due to a 10 per cent QoQ increase in volume and a 2 per cent increase in ASP on price hikes and a favourable mix. We expect consolidated revenue to grow 4 per cent QoQ.

"Expect standalone PV margin to remain flattish QoQ at 4.5 per cent due to commodity price inflation, partially offset by price hikes, lower marketing spends and cost-reduction initiatives. Expect JLR EBITDAM margin to improve 50 bps QoQ," it said.