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5 things to know about Tata Motors’ results

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A lot can be learned from the Tata Motors' results whether you are an investor or not

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5 things to know about Tata Motors’ results

  1. 1. 5 things to know about Tata Motors’ results
  2. 2. India’s largest automobile company Tata Motors announced its results for the quarter ended December 2016. Whether you have invested in Tata Motors or not, you may want to understand the results. Here are 5 things to know about the Tata Motors’ results.
  3. 3. Profits sink: • Consolidated net profits fell by 96% on year-on-year basis. • Revenue for the quarter declined by 4.3% compared to last year. • On standalone basis, Tata Motors announced yet another loss. • Net loss widened to Rs 1,046 crore from Rs 137 crore a year ago. #1
  4. 4. JLR • British luxury car unit Jaguar Land Rover is a major reason for this result. • The profits for JLR were much lower than market expectations.It reported a decline in operating profit margin to 9.3% against analyst estimates of 13.1%. This came as a surprise JLR has always been the cash cow for Tata Motors. • Higher costs for new model launch, variable market expense and unfavourable market mix were major reasons for poor performance. #2
  5. 5. Other factors • The Brexit effect had a damaging impact on JLR sales. • Demonetization impacted commercial vehicle sales in the Indian market. • Former chairman Cyrus Mistry’s departure was another contributing factor. #3
  6. 6. Shares crash • Shares of the company fell by 10.3% after results were announced. • The stock was the worst performer among the 30 components of Sensex. • This is the biggest decline for the stock in the past five years. Analysts expect further correction for the stock in the next few days. #4 Shares crash • Shares of the company fell by 10.3% after results were announced. • The stock was the worst performer among the 30 components of Sensex. • This is the biggest decline for the stock in the past five years. • Analysts expect further correction for the stock in the next few days.
  7. 7. Expert’s view • In the last two days, the stock already tanked by almost 15%. • Further correction is possible but a major fall is not expected. • It is best for long-term investors to remain invested in the stock. • Consider buying at lower levels to add leverage instead of booking a loss. #5
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