New Delhi: Automobile manufacturer Tata Motors beat market estimates on Thursday and reported a consolidated profit of Rs 1,738 crore for the October to December quarter of 2019-20 (Q3 FY20).

In the same quarter last year (Q3 FY19), the company had posted a record loss of Rs 26,993 crore due to one-time non-cash charge for asset impairment of Jaguar Land Rover (JLR) at Rs 27,838 crore.

But revenue from operations in Q3 FY20 dropped by 6.8 per cent to Rs 71,676 crore from Rs 76,916 crore last year. Earnings before interest, taxes, depreciation and amortisation (EBITDA) margins came in at 9.9 per cent for the December quarter.

However, Tata Motors reported a standalone loss of Rs 1,040 crore against a profit of Rs 617 crore in the year-ago period. The loss was due to a slump in domestic sales. In Q3 FY20 wholesales (including exports) decreased by 24.6 per cent to 1.29 lakh units.

The standalone revenue for the quarter decreased by 33 per cent to Rs 10,800 crore, the company said in a statement.

Managing Director and CEO Guenter Butschek said the auto industry in India continues to be impacted by the general economic slowdown. The profitability was impacted by adverse mix where despite increasing market shares, medium and heavy commercial vehicle volumes declined.

This coupled with proactive system stock reduction of Rs 3,800 crore resulted in a loss of operating leverage.

“Though the near-term market situation is fluid, we are optimistic on the medium term as we launch our exciting BS-VI range of products with our system inventory at a multi-year low,” said Butschek.

“We remain focused on driving our turnaround strategy and transitioning seamlessly to BS-VI. As we strengthen our internal capabilities, we remain confident of delivering competitive, consistent and cash accretive growth.”

Meanwhile, Tata Motors’ UK-based subsidiary Jaguar Land Rover (JLR) reported profit at 372 million pounds due to retail sales growth in China, which was up 24.3 per cent. Strong demand for the new Range Rover Evoque also helped the bottom line.

JLR’s Chief Executive Ralf Speth said: “Conditions in the automotive industry remain challenging, but we are encouraged by the recovery in our China business and the success of the new Range Rover Evoque. Our improving financial results and the cost and cash flow achievements of Project Charge will support the next phase of our pipeline of exciting new vehicles and technologies, with a choice of outstanding electrified, petrol and diesel powertrains.”

The company said JLR expects improved profitability and cash flow for the financial year 2020 with an earnings before interest and taxes (EBIT) margin of about 3 per cent. “However, the developing situation with coronavirus could have some impact on this.”

(ANI)