Tata Motors Q1 Results: This is how auto giant's stocks were impacted

Tata Motors shares on Thursday ended 4.8% down after its Q1  results which reported a loss of Rs 3,698 crore in June quarter due to low sales volume in domestic market including Jaguar Land Rover (JLR) sales. The shares of the automobile major have ended at Rs 144 on NSE, losing Rs 7.25 or 4.8% at closing hours. Tata-owned JLR also witnessed a loss of 402 million pound this quarter. The results have come out below expectations from experts as the automobile sector has seen a damp sales this year.

Market Research Head, Joindre Capital, Avinash Gorakhshakr told Zee Business Online, ''The share looks weak at present, would advise buyer to stay away. The company has posted highly negative results as the street estimated a loss of Rs 1,900 to 2,000 crore. It could go below Rs 125 in coming days, expected to end the week on negative note.''

While the company had posted a loss of Rs 1,902.37 crore in June quarter last year and profit of Rs 1,117.48 crore in March quarter 2019. Below are the highlights of Tata Motors Q1 results for FY2019-20:

1. Q1 impacted by demand slowdown, higher axle loads, liquidity stress, low freight availability for cargo operators.

2. Turnaround 2.0 intensified and company focused on doing the right things for long term success.

3. Commercial Vehicles (CV) and Passenger Vehicles (PV) continues to focus on retails given challenging market backdrop. 

4. CV Wholesale was down 16.0% while Retail was down 14.8%; PV Wholesale was down 30.1% while Retail was down 7.4% in domestic markets. 

''The company's approach towards this negative outcome will be watchful. As of now, the retail investor should wait for the share to settle. The domestic volumes and JLR sales would play the key role in revival,'' said Gorakhshakar.

The consolidated revenue during the quarter declined by 7.8 percent to Rs 61,467 crore compared to year-ago. Meanwhile, the JLR retail sales (including China JLR) slipped 11.6 percent to 1,28,615 units and wholesales fell 9.9 percent to 1,18,550 vehicles in Q1 YoY.

On standalone front, wholesales degrew by 22.7 percent to 1,36,705 units and retail sales declined 12.6 percent compared to year-ago with commercial vehicle sales falling 19.5 percent and passenger vehicle down 30.1 percent in Q1 YoY.

The company has remained confident about domestic industry saying it expects the performance to gradually improve in the rest of the year and both businesses (commercial vehicle and passenger vehicle) will focus on stepping up retail growth, improve dealer profitability, launch exciting products while driving rigorous cost reduction as it transitions smoothly to BS VI.