Resilient Performer

India’s leading multinational automotive manufacturing company Tata Motors gave a good account of itself in a challenging environment to deliver a healthy set of financial numbers and retain its seventh position in this year’s list of BW Real 500 companies. The company was ranked seventh in the previous list as well. 

"Tata Motors group is now operating as three independent business units of commercial vehicles, passenger vehicles and Jaguar Land Rover, offering differentiated value propositions to their different customer segments whilst leveraging backend and corporate synergies where possible," said N. Chandrasekaran, chairman and non-executive director of the company. 

Describing 2021-22 as a 'busy year' for Tata Motors, Chandrasekaran said the company navigated multiple challenges to successfully strengthen the fundamentals of the business. In FY22, the company's global sales increased 20 per cent to 1,086,734 vehicles and revenues stood at Rs 2,78,454 crore, 11.5 per cent higher than FY21 numbers. 

It must be noted here that the automotive industry saw an adverse impact of commodity inflation and semiconductor shortages all through FY21 and FY22. 

Free cash flow (automotive) in the year was negative at Rs 9,472 crore (as compared to positive Rs 5,317 crore in FY21) for the company primarily due to adverse working capital, the chairman informed the shareholders. "Despite the margins being impacted by supply chain issues and runaway commodity inflation, our India business ended with strong free cash flows of Rs 1,879 crore," Chandrasekaran said. 

Healthy Numbers

The commercial vehicles segment volumes grew 37 per cent in FY22 and revenues 58 per cent, with the company launching more than 80 new products and 120 variants across segments in FY22. This was done to cater to the evolving needs of seamless cargo and people transport across sub-segments and applications. The passenger vehicles (PV) segment was the standout performer during the year. The chairman noted that preference for Tata Motors ‘New Forever’ range of vehicles continued to rise in FY22. The company introduced more than 25 new products and variants to lead in the fastest-growing market segment. 

Passenger vehicles recorded its highest ever domestic annual sales of 3,70,354 units in FY22. Overall, the domestic market share for Tata Motors increased to 12.1 per cent. The company saw 67 per cent growth in volumes and 90 per cent growth in revenues. In electric vehicles, new records were set every quarter to register the highest ever annual EV sales of 19,105 units in FY22 (up 353 per cent over FY21) with penetrations touching 7.4 per cent by Q4 FY22.

“By 2025 Tata Motors will have 10 EVs,” said Chandrasekaran. “The unveil of the long-range Nexon EV Max, showcase of CURVV electric SUV concept and the unveil of the AVINYA concept, a pure EV based on GEN3 architecture, show the exciting possibilities ahead of us,” he added. 

Focused Approach

During FY22, the company operationalised two subsidiaries: Tata Motors Passenger Vehicles which would continue to focus on passenger vehicles powered by IC engines and the Tata Passenger Electric Mobility, which would focus on accelerating the passenger EV business and its enabling ecosystem, the chairman said. 

The Jaguar Land Rover embarked on the “Reimagine” journey to embrace an “electric future” and transform into a digitally-savvy, modern luxury business delivering strong financial results in 2021-22. During the year, Tata Motors saw the successful global launch of New Range Rover, while customer deliveries of the Land Rover Defender continued across 94 markets, with 107,208 units sold by the end of FY22. Chandrasekaran admitted that the global shortage of semiconductors had a disproportionately adverse impact on Jaguar Land Rover’s production and sales compared to its competitors. However, the company was working assiduously to address the same during FY23, he said. 

N. Chandrasekaran, Chairman, Tata Motors 

Total Assets: Rs 3,30,620 crore

Total Income: Rs 2,81,507 crore

Operating Profit: Rs (7,003) crore

Net Profit: Rs (11,309) crore