Tata Motors, India’s largest automobile company, reported impressive August numbers for its luxury brand Jaguar Land Rover (JLR). Its wholesale volumes in August grew by a robust 28% year-on-year (y-o-y) to 42,260 units, while its retail volumes rose by 26% y-o-y to 36,926 units. Its global vehicle sales rose by 16% to 86,288 units in August. However, its global commercial vehicle sales remained flat in August. Cumulative commercial vehicles wholesale for the fiscal rose by 6% over 2015-16 standing at 1,55,296.
Jaguar’s wholesale and retail volumes roughly doubled. These volumes were aided by recently launched F-Pace and XE. However, Land Rover’s volumes have grown at a slower pace. Its wholesale and retail volumes have risen by 10.2% y-o-y and 8.6% respectively.
North America, Europe and China reported superb growth with North America reporting a huge 45% y-o-y growth. Europe and China too reported impressive growth at 36.8% and 34% respectively. United Kingdom (UK) and other markets reported negative growth. However, the numbers were not good on a month-on-month (m-o-m) basis. Europe’s volumes declined by 25% m-o-m. The decline in UK’s volumes was significant at 69% m-o-m to 2,373 units. China’s month-on-month volumes rose by 7.6% while the volumes of North America and other markets declined slightly.
Coming to different models, its sales of XE rose by a robust 50% to 2,792 units. Its new launches F-Pace, XE and Land Rover Discovery Sport performed exceedingly well. F-Pace sold 4,460 units, while XE’s sales rose by more than half to 2,792 units. Discovery Sport’s volumes too jumped by 57% to 7,053 units.
One of the most notable features is the change in revenues contributed by different regions over the years. For instance, according to Religare, United Kingdom (UK) contributed to 17.7% of its volumes in FY13-14. However, this contribution has declined to merely 6.4% in August 2016. On the contrary, the contribution of North America to its revenues over the years has increased to 28% in August 2016 from 17.4% in FY13-14. The contribution of Europe, North America and other markets over the years has remained roughly similar over the years.
In terms of the future, the launching of XFL model in China is expected to lead to a rise in volumes of Jaguar. New Discovery is expected to be unveiled in late – September, which is expected to lead the volumes for Land Rover. In addition, Evoque convertible will also be released.
Tata Motors is the market leader in commercial vehicles in India. It has operations in UK, South Korea, Thailand, Indonesia and South Africa. Its consolidated revenues stood at a humungous Rs2,75,561 crore in 2015-16. Tata Motors trades at a price-to-earnings (PE) multiple of 18 times its trailing 12 months earnings. Its consolidated debt-equity ratio stood at 0.78. The stock has had an extraordinary run in the past 6 months. During this period, it has more than doubled from a low of Rs266 in February 2016 to Rs554 currently.