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Tata Motors Group Results Q3 FY23 |
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January 25, 2023 |
TATA COMMERCIAL VEHICLES (TATA CV)
HIGHLIGHTS
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Q3 revenue at ₹ 16.9KCr,
(+22.5%), EBITDA 8.4% (+580 bps), EBIT 5.9% (+650 bps), PBT (bei) ₹ 0.9 K Cr. |
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Q3 Tata CV global wholesales stood at 97.1K units (-6% yoy), primarily
because of weaker international business volumes. |
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Q3 CV domestic wholesales at 90.8 K units (flat yoy), domestic retails at 97.7K units (+5%).
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Domestic CV market share (based on Vahan) at 42.1% in YTD FY23 (-260 bps
vs FY22), although improving month on month in Q3. |
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Commenced deliveries of ACE EV, marking a significant leap forward in offering sustainable mobility solutions.
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Smart city mobility business continues to witness strong growth; signed definitive agreement for operating 1,500
buses in Delhi, 921 buses in Bengaluru and 200 buses in Jammu & Kashmir. |
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Comprehensive range of green and zero emission mobility solutions showcased at Auto Expo. |
FINANCIALS
The commercial vehicles
industry witnessed a robust recovery in Q3 FY23 led by strong demand in MHCV and passenger carrier segment. Improving fleet utilizations, pick up in road construction projects and increase in cement consumption catalyzed the demand recovery for
MHCVs. CV exports, however, remained subdued due to the prevailing economic situation in most of our overseas markets. Domestic wholesales were at 90.8k units (flat yoy), domestic retails at 97.7k units (+5%). Our continued focus on retail during
the quarter resulted in retail sales surpassing wholesale by 6.3% in Q3 FY23, and reducing system inventory as we transition towards BSVI phase-2 norms.
Revenues at ₹ 16.9KCr was up 22.5% yoy
despite wholesales being down 6%, reflecting improved mix and better market operating price. Q3 FY23 EBITDA margins were 8.4% (+580 bps yoy) and EBIT margins were at 5.9% (+ 650 bps yoy) led by sustained pricing improvement, cost actions and
softening commodity prices. The business was PBT (bei) positive at ₹ 0.9K Cr as compared to loss of ₹ 0.2K Cr in Q3 FY22.
LOOKING AHEAD
The CV
industry is poised for growth on the back of increased infrastructure activity, demand for last mile mobility and strong recovery in bus segment. Going forward, we expect a good replacement demand, especially in MHCVs in Q4 FY23, as we also maintain
a close watch on the evolving geopolitical situation, inflation and interest rate risks on both the supply and demand. The recent exciting launches of the new range of smart trucks in MHCV and ILCV, and best-in-class pickups will help us serve our customers better. We exhibited most comprehensive range of greener and zero emission mobility solutions at Auto Expo, across cargo and passenger segments, powered
by natural gas, electric and hydrogen. Focus will continue to remain on registration market share improvement with demand-pull strategy, innovation intensity, restoring double-digit EBITDA margins and successfully delivering on new business models.
Girish Wagh, Executive Director Tata Motors Ltd said:
In Q3 FY23, the CV industry witnessed a steady, overall demand. Our focus on creating Demand Pull from customers and sustained
emphasis on retail in Q3 FY23 resulted in retail sales surpassing wholesale by 6.3%, thereby enabling reduction in inventory as we transition towards BS VI phase-2 norms. Led by realization
improvement, revenue growth was higher than volume growth. Realization improvement coupled with commodity softening and cost control resulted in improved margins. Going forward, we will maintain our agility and keep a close watch on the evolving
geopolitical, inflation and interest rate risks on both supply and demand. We will also continue to drive the business with strong customer connect, product and service innovations to improve customer affinity for our brands, step-up registration market shares sustainably, and improve realisations and profitability.
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