Tata Motors Indian operations continued its strong growth in the quarter with CV witnessing a sequential recovery and PV witnessing continued strong growth. PV absolute EBITDA is the highest in the last 10 quarters. CV profitability improved sequentially due to better mix (higher MHCV & ILCVs) and ongoing cost savings. Business generated strong positive free cash flows led by the cash savings initiatives.

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Thinking about JLR, the quarter reflected strong sequential recovery in retails in all the markets except the UK where Q3 remains seasonally lower. The business achieved 6.7% EBIT margin and strong positive free cash flows of £0.6 bn

Tata Motors remain committed to consistent, competitive, cash accretive growth and deleverage the business through focused execution of company's strategy in all businesses.

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JLR highlights:

Improved profits reflect revenue of £6 bn, up £1.6 bn from Q2 while still lower than last year. Positive free cash flow (FCF) of £562 mn, a Q3 record transformation savings of £0.4 bn in Q3, YTD £2.2 bn. They have liquidity of £6.4 bn with £4.5 bn of cash and £1.9 bn undrawn credit facility. Electrified options extended to 12 JLR models, including 8 plug-in hybrid, 11 mild-hybrid, and the all electric Jaguar I-PACE Despite prevailing external risks, expect to deliver strong EBIT margins and positive FCF in Q4.

Q3 retail sales were 128469 vehicles, up 13.1% on Q2 but still 9% lower than pre-Covid levels a year ago. Sales in China were up 20.2% on the prior quarter and up 19.1% yoy. Most other regions also witnessed a sequential recovery though still below prior year. Sales of the new Land Rover Defender grew to 16286 units, +66.0% over the previous quarter.

The significant improvement reflects revenue of £6 bn, up £1.6 bn from Q2 while still lower than preCovid levels a year ago, with favourable sales mix, cost performance and partial reversal of prior period reserves for emissions and residual values. EBIT margin improved to 6.7% (+400bps year on year).

Profit and cash improvements from the Project Charge+ transformation programme in the quarter were £0.4 bn, including £0.2 bn of cost and £0.2 bn of investment efficiencies. Free cash flow in the third quarter was £562 mn, primarily reflecting the strong PBT and favourable working capital after £675 mn of investment spending.

Jaguar Land Rover remains encouraged by the Brexit trade deal agreed in December between the UK and the European Union. Jaguar Land Rover continues to expect a gradual improvement in sales supported by new and refreshed vehicles incorporating the latest technologies.

Recent products include the short wheel-base Land Rover Defender 90 and the refreshed 21 model year Range Rover Velar, Land Rover Discovery, Jaguar F-PACE, E-PACE and XF. Additionally, electrification has been extended to most JLR models, including 8 with PHEV, 11 with MHEV, and the all-electric Jaguar I-PACE.