Tata Motors (TMCV) Q4 20/21 earnings summary

Executive summary

• FY21 remained heavily disrupted by COVID-19, but recovery through the year and cost actions improved profitability and cash generation.

• Consolidated EBITDA margin rose to 12.2% from 8.5%; EBIT margin improved to 2.6% from approximately zero, while auto free cash flow turned positive at ₹5,317 crore.

• Consolidated net loss widened to ₹13,395 crore from ₹11,975 crore, including ₹14,994 crore of JLR Reimagine-related exceptional charges.

Financial highlights

• Revenue from operations was ₹2,49,795 crore, down 4.3% YoY; lower vehicle volumes were partly offset by favorable mix, pricing and currency translation.

• Operating profit increased to ₹35,782 crore from ₹23,914 crore; EBITDA margin was 12.2% versus 8.5% and EBIT margin was 2.6% versus (0.04)%.

• Auto free cash flow, post interest, was ₹5,317 crore versus an outflow of ₹12,676 crore; cash and cash equivalents reached ₹31,700 crore at year-end.

• Standalone revenue rose 7.1% to ₹47,031 crore; loss after tax narrowed to ₹2,395 crore from ₹7,290 crore.

Outlook and guidance

• FY22 performance was expected to improve gradually, with demand supported by personal mobility but production constrained by COVID-related disruptions and semiconductor shortages.

• FY22 product and other investment spending was projected above ₹28,900 crore consolidated; standalone TML guidance was ~₹3,500 crore and JLR guidance ~£2.5 billion.

• Targets included net auto debt reduction to zero within three years, PV free-cash-flow breakeven by FY23, and JLR double-digit EBIT margin with positive cash flow.

• JLR targeted Jaguar as all-electric from 2025, six electric Land Rover models by 2026, 60% BEV sales by 2030 and net-zero carbon across supply chain, products and operations by 2039.