Tata Motors released their first quarter results and the results were not quite what they were predicting. Analysts had forecast Tata Motors, the owner of the Jaguar Land Rover to have higher than realized first quarter net income reports. This comes as the sale of passenger cars in India fell and the deliveries of the popular Jaguar line also fell.
While the actual numbers were lower than analyst’s estimates, there was a net increase in net income. Net income for Tata Motors increased to 20 billion rupees, or 441 million dollars, from the previous 19.9 billion rupees level the previous three months. Sales also increased by twenty four percent, up to 333.9 billion rupees.
Thirty two analysts had painted the profit level to be a 21.6 billion-rupee median, but this number fell short.
A primary reason for falling behind the analyst’s predictions was the slumping deliveries and sales of the popular Jaguar Model. Jaguar sales had decreased twenty seven percent in this period than it was the year previous. Jaguar sales was not all that declined, Tata Motors also reported an eight and a half percent drop in passenger car sales from the previous year’s identical period.
One often cited cause for the decrease in sales is the raising interest rates. India is a nation that sees eighty percent of its purchases funded by loans, so when interest increases the number of loans issued decreases, thus decreasing consumption and company’s sales reports take a hit.
Tata Motors bought the Jaguar Land Rover unit in 2008 and has been seeking ways to improve the luxury line and take a larger segment of the high end market.
Tata Motor stocks also took a hit from the below forecast results. Tata Motor shares fell nearly six percent down to 800 rupees, but the company goes on. The Range Rover Evoque is set to be released in September and it already has 18,000 bookings. Sales of the Range Rover Evoque will be essential in competing with the r Bayerische Motoren Werke AG and the Daimler AG’s Mercedes-Benz. New Jaguar XF’s are expected to also be released before the year’s end.