JLR bites, Tata Motors net loss hits Rs 26,961 crore
The company has posted a net profit of Rs 1,214.6 crore, was hurt by the US-China trade war, low demand for diesel cars in Europe and Brexit worries.
Mumbai: Hit by one-time asset impairment in its British arm Jaguar Land Rover (JLR), Tata Motors reported a massive net loss of Rs 26,960.8 crore for the third quarter ended December 31, 2018.
The company has posted a net profit of Rs 1,214.6 crore, was hurt by the US-China trade war, low demand for diesel cars in Europe and Brexit worries.
JLR, that contributes nearly 72 per cent to Tata Motors’ revenue, had a bumpy the past year as sales fell on account of slowing business in its key market China. The luxury carmaker also shut down one of its plants in October to cope with the weakening demand. Meanwhile, Tata Motors’ total revenue from operations rose 4.36 per cent to Rs 77,582.71 crore as compared to Rs 74,337.7 crore, the company said.
On a standalone basis, the company posted profit after tax of Rs 617.62 crore as against Rs 211.59 crore.
Total standalone income rose to Rs 16,477.07 crore as against Rs 16,186.15 crore.
JLR’s revenue, however, declined 1 per cent to 6.2 billion pounds. “Given the muted demand scenario and the associated impact on the financials, JLR has concluded that the carrying value of capitalised investments should be adjusted down, resulting in a non-cash £3.1 billion pre-tax exceptional charge and an overall pre-tax loss of £3.4 billion for the quarter,” Tata Motors said.
Commenting on the step, JLR CEO Ralf Speth said, “We are announcing a non-cash exceptional charge to reduce the book value of our capitalised investments”.
“The automotive industry is facing significant market, technological, and regulatory headwinds. At the same time, investment in new models, electrification and other technologies remains high”, he added.