Tata Motors Passenger Vehicles (500570) Q2 25/26 earnings summary

Executive summary

• Q2 FY26 was significantly impacted by a cyber incident at JLR, causing production stoppages and lower volumes, while the domestic passenger and electric vehicle businesses showed resilience and strong growth, supported by festive demand and GST reductions.

• Consolidated Q2 FY26 revenue declined 13.5% year-over-year to ₹72,349 crore, with EBITDA at -0.1% and PBT (before exceptional items) at -₹5,462 crore.

• Net profit for the quarter was ₹76,248 crore, driven by a notional profit of ₹82,616 crore from the disposal of discontinued operations following the demerger and restructuring.

• Standalone passenger vehicle business saw robust growth, with Q2 FY26 revenue up 15.6% year-over-year to ₹13,529 crore, supported by strong festive demand and GST reductions.

Financial highlights

• JLR Q2 FY26 revenue fell 24.3% year-over-year to £4.9 billion, with EBIT margin at -8.6% and a loss after tax of £559 million, impacted by the cyber incident and US tariffs.

• Tata Passenger Vehicles Q2 FY26 EBITDA margin was 5.8%, EBIT margin at 0.2%, and PBT (before exceptional items) at ₹155 crore.

• Free cash flow for the consolidated auto business was negative, with JLR reporting a £791 million outflow, while domestic PV business generated ₹1,600 crore in free cash flow.

• Net auto debt increased to ₹20,100 crore, mainly at JLR; domestic business remains net cash.

• Exceptional items for the quarter included ₹2,008 crore in cyber-related expenses and ₹840 crore in employee separation costs.

Outlook and guidance

• JLR revised FY26 EBIT margin guidance to 0%–2% and expects free cash outflow of £2.2–2.5 billion, focusing on production ramp-up and cost savings.

• The group expects improved performance in H2 FY26, focusing on stabilizing production, supply chain resilience, and new product launches.

• Domestic PV business anticipates double-digit industry growth in H2, leveraging GST 2.0-driven demand and new launches.

• Price increases planned for Q4 to offset commodity cost pressures; discounting expected to reduce post-festive season.