Tata Motors Q4 results for FY25 have raised eyebrows across Dalal Street. The company reported a 51.2% year-on-year fall in consolidated net profit, landing at ₹8,556 crore, compared to ₹17,528 crore in Q4 FY24. Though total income stood steady at ₹1.21 lakh crore, this sharp decline in bottom line has prompted mixed reactions from market participants. Despite quarterly pressure, Tata Motors clocked its highest-ever annual revenue and PBT for FY25, highlighting the company’s long-term resilience.
Why Did Tata Motors’ Q4 Profit Dip So Sharply?
The net profit drop is mainly due to external economic headwinds and increased operational costs. While the Q4 EBITDA dropped 4.1% to ₹16,700 crore, the EBIT rose to ₹11,500 crore, up ₹1,000 crore year-on-year, indicating some margin protection. Revenue remained flat at ₹1.21 lakh crore versus ₹1.20 lakh crore in the same quarter last year.
The global auto market remains volatile due to geopolitical tensions and tariff uncertainties, especially in the luxury segment. Yet, Tata Motors believes the premium and Indian domestic markets are better equipped to handle these shocks, offering some comfort for long-term investors.
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FY25 in Review: A Year of Records and Strategic Shifts
While Q4 was sluggish, the overall FY25 performance paints a robust picture. Tata Motors achieved record revenues of ₹4,39,700 crore, with EBITDA at ₹57,600 crore. Profit before tax (before exceptional items) hit an all-time high of ₹34,300 crore, while the net profit stood at ₹28,100 crore.
The highlight of the year? The TML Group turned net cash positive, closing the year with a ₹1,000 crore surplus. Lower depreciation at JLR, better commercial vehicle (CV) profitability, and reduced interest costs helped offset weaker volumes.
Dividend, Demerger, and Debt-Free Ambitions
The board has proposed a final dividend of ₹6 per share, subject to shareholder approval. This signals confidence in the company’s financial strength despite Q4 softness.
CFO PB Balaji emphasised that Tata Motors is now debt-free on a consolidated auto basis, helping lower interest outflows significantly. He added that the approved demerger will unlock further value, helping the company focus better on its core strengths.
Disclaimer: The views and investment insights provided here are based on publicly available information and do not constitute financial advice. Readers are advised to conduct their own research or consult certified financial experts before making investment decisions.
