At a Glance
Tata Motors is no longer the debt-ridden underdog it once was. With Jaguar Land Rover now printing profits, India’s most iconic automaker has posted ₹28,149 Cr PAT in FY25, up from ₹-12,000 Cr just four years ago. But with the stock falling 29% in the last year, is the party over?
1️⃣ The Desi Luxury Exporter You Forgot Was Desi 🇮🇳➡️🇬🇧
Let’s get this out of the way:
- Tata Motors is NOT just about Indian SUVs and CVs.
- It’s basically a Jaguar Land Rover holding company in disguise.
- Over 70% of revenue now comes from JLR — not Nexon, not Punch, but posh Range Rovers.
How big is JLR?
- FY25 Revenue from Tata Motors: ₹4.4 Lakh Cr
- JLR contributed ~₹3.1 Lakh Cr+
- FY25 JLR Net Profit alone was over ₹20,000 Cr, driven by:
- Strong Defender and Range Rover demand
- China rebound
- Electrification strategy (Range Rover Electric coming soon)
- Moody’s upgrade in June 2025 from Ba2 to Ba1 💸
Oh, and JLR’s EBIT margin? 11.5% in Q4FY25. Solid.
2️⃣ The Numbers Behind the ₹674 Price Tag 💸
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 2,49,795 | 2,78,454 | 3,45,967 | 4,34,016 | 4,39,695 |
| Net Profit (₹ Cr) | -13,395 | -11,309 | 2,690 | 31,807 | 28,149 |
| OPM (%) | 13% | 9% | 9% | 13% | 13% |
| ROE (%) | -41% | -34% | 7% | 94% | 75% |
| Debt (₹ Cr) | 1,42,131 | 1,46,449 | 1,34,113 | 1,07,264 | 71,540 |
| EPS (₹) | -40.51 | -34.46 | 7.27 | 94.47 | 75.60 |
🚀 Turnaround much?
Tata Motors went from:
- Bleeding cash 🩸
- High leverage 😵
- JLR being a drag 🐌
To:
- ₹67,000 Cr operating cash in FY24
- Debt reduced by ₹75,000 Cr in 4 years
- ₹28,000 Cr profit
3️⃣ But Wait… Why Has the Stock Fallen 29% in 1 Year? 📉
Let’s decode the mystery:
- 🔄 De-merger announcement (JLR and Indian business to be separate) spooked investors. Will the India ops lose global halo?
- 🐌 Domestic PV and EV sales growth slowed down in FY25 — Nexon EV isn’t the iPhone anymore.
- 🏎️ JLR sales in Q4FY25 were flat YoY — the Defender held strong, but China is still wobbly.
- 📉 Stock had run up 3x from COVID lows — time for profit booking.
- 🧓🏼 Promoter holding dipped to 42.58% (from 46%) — some read it as “exit sign.”
4️⃣ Tata vs Maruti vs M&M vs Hyundai: Who’s Winning?
| Company | Net Profit (Q4FY25) | Revenue (₹ Cr) | P/E | ROCE (%) |
|---|---|---|---|---|
| Tata Motors | ₹8,556 Cr | ₹1,19,503 Cr | 8.8 | 20.0 |
| Maruti Suzuki | ₹3,911 Cr | ₹40,920 Cr | 27.7 | 21.8 |
| Mahindra & Mahindra | ₹3,541 Cr | ₹42,599 Cr | 30.9 | 14.1 |
| Hyundai India (unlisted) | ₹1,583 Cr | ₹17,562 Cr | — | 54.2 |
🥇 Tata Motors wins on profits.
But also has:
- Lowest P/E (valuation comfort)
- Highest absolute revenue
- BUT lowest premium segment visibility vs M&M (Thar = cult), Maruti (bread and butter), and Hyundai (EVs)
5️⃣ Future Triggers 🔮
✅ JLR’s EV lineup — Range Rover Electric in 2025
✅ CV upcycle — with infra push in India
✅ IPO of Tata Technologies could unlock more value
✅ Domestic EV portfolio — Punch EV, Nexon EV upgrades
✅ De-merger value unlocking (if executed well)
⚠️ China slowdown and luxury fatigue risks JLR
⚠️ Domestic EV competition heating up (Mahindra BE, Hyundai Ioniq series, MG)
6️⃣ Fair Value Range 🔍
We reverse DCF this baby:
- Base case PAT FY26: ₹32,000 Cr
- Implied EPS: ~₹85
- Assign 15x P/E (lower than peers due to cyclical biz + JLR lumpiness)
- Fair Value = ₹1,200–₹1,300 (20–30% upside)
🔻 Downside Risk: ₹600 (if JLR falters again)
📌 Current Price: ₹674
🎯 Risk-Reward tilted positively — if JLR sustains margins and EV bets play out.
7️⃣ EduInvesting Verdict 🧠
This isn’t the old Tata Motors you avoided at ₹70.
This is a global auto machine with ₹28,000 Cr profit, 20% ROCE, and a luxury brand that’s suddenly working.
Sure, it may not be sexy like a Zomato or mysterious like IRFC.
But it’s no longer a “turnaround” — it’s a cash-printing Tata tank.
✍️ Written by Prashant | 📅 June 26, 2025
Tags: Tata Motors, JLR, Jaguar Land Rover, Nexon EV, Indian Auto Stocks, De-merger, Auto Sector Stocks, EduInvesting, Turnaround Stock, Value Stock
