Tata Motors Q3 net profit plummets by 96% to Rs 112 crore

The reasons of profit being dragged down were the losses in domestic operations and lower profit of its British arm JLR.

The drop in the profit and revenue was driven by a fall in demand for the firm's commercial vehicles owing to the Indian government's abrupt move in November to pull high-value banknotes from circulation, the Mumbai-based company said.

On standalone front, Tata Motors' net loss widened to Rs 1,045.94 crore, compared to net loss of Rs 107.89 crore in Q3FY16 and Rs 606.84 crore in Q2FY17.

For the nine month period ended December 31, 2016, the company posted a consolidated revenue of Rs 1,99,429 crore (Rs 1,92,543 crore). This resulted in a fall in margins to 9.3% from 14.4%.

Tata Motors Ltd.'s quarterly profit plunged 97 percent after margins at its luxury Jaguar Land Rover unit narrowed and costs surged. But the performance of the auto business was not good enough to prevent Tata Motors' India operation from posting a sharp increase in losses.

More news: Manny Pacquiao Asks Twitter To Decide Next Opponent

The Jaguar Land Rover unit is vulnerable because it doesn't have factories in the US and sells much of its United Kingdom output overseas.

Earlier in February, Tata Motors unveiled a new brand called TAMO, aimed at testing new technologies and enabling the company to become more responsive to changing market trends.

Shares of Tata fell as much 7.3%, before recouping some of the losses to close 3.7% lower at 486.8 rupees on Mumbai's BSE stock exchange. Exports grew by 34.6% year-on-year. "JLR margins would definitely be better in the fourth quarter, hopefully on the back of the new launches that we have".

"What is it that we need to be a high performance organization- being lean, it's about being agile and it's about having clearly addressed and delegated accountability", Butschek told a news conference on Tuesday.

Prime Minister Narendra Modi's demonetisation drive removed around 86 per cent of India's cash at a stroke, triggering massive queues outside banks and a cash shortage that has hit businesses across the country. "More so, the JLR product mix has altered quite substantially" and variable marketing spending has been on the rise, Sabarad said. The US accounts for about 25% of JLR sales.

Edition: