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HomeMarket NewsTata Motors shares fall 5% after JLR sees lower margins for FY26 from last year
Tata Motors' UK unit had reported a free cash flow of £1.5 billion in the previous financial year. However, it sees that number 'close to zero' in the current financial year.
Shares of Passenger and Commercial Vehicle manufacturer Tata Motors Ltd. fell as much as 5% on Monday, June 16, after its unit Jaguar Land Rover (JLR) shared a muted outlook for the current financial year compared to last year.
JLR expects its EBIT margin to be between 5% and 7% for financial year 2026, compared to the 8.5% margin it reported in the previous financial year.
Tata Motors' UK unit had reported a free cash flow of £1.5 billion in the previous financial year. However, it sees that number 'close to zero' in the current financial year.
The management of JLR is targeting an improvement in its free cash flow from financial year 2027 and 2028 and is also targeting to get its EBIT margin back to 10% in the future, although it has not shared a timeline for the same.
For financial year 2025, JLR contributed to 71% of Tata Motors' revenue and 80% of its overall profitability. Average revenue per unit above £70,000 remained flat on a year-on-year basis.
Shares of Tata Motors are trading 4.6% lower on Monday at ₹679.65. The stock is the top loser on the Nifty 50 index and also among the top losers on the Nifty 500.
