India's Tata Motors beats Q1 profit estimates on strong luxury car sales
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India's Tata Motors reported a better-than-expected rise in first-quarter profit on Thursday, on higher sales of its more expensive car models in its luxury Jaguar Land Rover division.
The country's largest carmaker by revenue reported its consolidated net profit jumped 73.8% year-on-year to 55.66 billion rupees ($665 million) in the three months to June 30.
Analysts, on average, expected a profit of 54.25 billion rupees, per LSEG data.
The luxury JLR is Tata Motors' bellwether, accounting for about two-thirds of the Tata Group company's revenue. Among the British division's cars, its Range Rover, Range Rover Sport and Defender models are its most margin-boosting as they are more expensive.
The contribution of these models to JLR's total wholesale volumes increased to 68% in the June quarter, it said in a quarterly update in July, up from 57.6% in the last year.
However, JLR's wholesales volume growth of 5% in the quarter is its slowest in two years as its key European market exhibited weakness in demand.
The company said it is retaining its full-year forecast of 8.5% margin on earnings before interest and taxes (EBIT) for JLR.
Tata Motors' revenue grew 5.7% to 1.08 trillion rupees, its fifth straight quarter of slowing revenue growth.
Meanwhile, car wholesales in India hit a two-year low in the April-June as India's general elections and extreme heat hurt demand, with the company's total domestic sales volume growing 2% in the quarter, its slowest in three quarters.
Rival carmaker Maruti Suzuki beat quarterly profit estimates and Mahindra & Mahindra reported a larger adjusted profit on Wednesday. ($1 = 83.7170 Indian rupees)
