Tata Motors hits a speed breaker

Tata Motors, as expected is among the top five losers on the BSE, going down over 6% to Rs.289 levels, which just a tad away from its 52-weel low of Rs.288.30.

The market is very disappointed by the company’s Q4FY18 performance because it has been much below the estimates put out by various analysts. The company reported a 50% (YoY) drop in consolidated net profit at Rs.2176 crore despite a 16% increase in revenue at Rs.91,279 crore.

The fall in net profit was mainly on account of a Rs 1,641.38-crore impairment charge for capital work in progress.

EBITDA for the quarter was up 4% at Rs.11,250 crore while margins dropped from 14% to 12.3%.

Our Editor, Mr.SP Tulsian has a very different view. In the Stock Query section he has explained, “ Standalone numbers are seen quite good with PBT before exceptional expenses seen at 488 cr against Rs.244 crore (QoQ). Consolidated numbers are seen quite dull but not as bad as projected by Media. PBT for Q4 before exceptional is at Rs.3948 cr against Rs.2034 crore (QoQ) and Rs.6246 crore (YoY). JLR EBIT fell to Rs.3317 cr from Rs.5931 cr (YoY) but rose from Rs.194 crore (QoQ). Share will rule weak today but will settle today itself , with weakness unlikely to be seen in the next week.”