Tata Motors Passenger Vehicles Limited (TMPV) faced a challenging second quarter, reporting a consolidated profit before tax (PBT) loss of Rs 5,500 crore. The significant loss was primarily attributed to a cyber incident at Jaguar Land Rover (JLR) that halted production for the entire month of September, resulting in a 24% revenue drop for the luxury car maker.

JLR Cyber Incident Impact

The cyber attack on JLR had far-reaching consequences:

• Production shutdown for the entire month of September
• 24% revenue decline for JLR
• Loss of approximately 50,000 units in production
• Negative EBIT margin of 8.6% for JLR
• Negative free cash flow of £791 million for JLR

JLR CEO Adrian Mardell stated that the company expects an EBIT margin of 0-2% for the full year, with free cash flow projected between negative £2.2-2.5 billion.

India Passenger Vehicle Business Shows Resilience

Despite the challenges faced by JLR, the India passenger vehicle business demonstrated recovery:

• 15% year-on-year revenue growth
• 10% volume increase
• Record-breaking sales in September and October, with over 60,000 units sold in each month
• Market share improvement to 12.8% for the quarter, with post-GST festive months reaching 13.7% to 14%

Electric Vehicle Segment Gains Momentum

TMPV's electric vehicle (EV) segment showed significant progress:

• EV penetration increased from 12% to 17%
• Record EV retails of 9,000 units during the festive season
• Harrier.ev launch contributing to increased EV sales, with a run rate of about 2,500 units per month
• EV market share consistently at 42%

Financial Highlights

Future Outlook

TMPV management outlined several strategies to improve performance:

1. Ramping up JLR production to full capacity for the remainder of the fiscal year
2. Launching new products, including the Sierra
3. Expanding the EV portfolio and improving profitability through PLI accruals
4. Implementing cost reduction measures and potential price increases in Q4

Shailesh Chandra, MD & CEO of TMPV, expressed optimism about the domestic market, projecting double-digit growth for the industry in the second half of the fiscal year.

The company faces challenges in global markets, particularly in China, where luxury vehicle demand remains weak. However, TMPV aims to leverage its strong brand recall, especially for the Range Rover, and focus on expanding its presence in international markets, including a recent entry into South Africa.

As TMPV navigates through the aftermath of the cyber incident and global market challenges, the company's resilience in the domestic market and growing EV segment provide a silver lining for its future performance.

Tata Motors, one of India's leading automobile manufacturers, has reported a significant financial setback in its latest quarterly results. The company's passenger vehicle division posted a net loss of ₹6,370 crore, a stark reversal from the ₹3,056 crore profit recorded in the same period last year. This downturn comes in the wake of a cyberattack that severely impacted the company's operations, particularly its Jaguar Land Rover (JLR) unit.

Impact of Cyberattack

The cyberattack proved to be a major blow to Tata Motors' operations, resulting in:

• A direct loss of ₹2,008 crore
• Crippled production capabilities
• Negative free cash flow of ₹8,300 crore

Financial Performance

The company's financial performance was significantly affected, as evidenced by the following key metrics:

JLR Performance and Guidance

Jaguar Land Rover, a crucial component of Tata Motors' global strategy, has also felt the impact of these challenges:

• JLR has revised its EBIT (Earnings Before Interest and Taxes) margin guidance downward to 0-2% from the previous 5-7%
• This adjustment reflects the severity of the operational disruptions caused by the cyberattack

Quarterly Comparison

A closer look at the quarterly figures reveals the extent of the financial impact:

Despite the year-over-year increase in sales, the company's profitability has been severely affected, as reflected in the negative operating profit margin and earnings per share.

Looking Ahead

Tata Motors faces significant challenges as it works to recover from the cyberattack and stabilize its operations. The company's ability to rebound may depend on several factors:

1. Strengthening cybersecurity measures to prevent future attacks
2. Restoring full production capacity, particularly in the JLR division
3. Managing cash flow and reducing the negative impact on working capital
4. Rebuilding investor confidence through transparent communication and strategic planning

As Tata Motors navigates these turbulent times, stakeholders will be closely watching the company's recovery efforts and its ability to return to profitability.