1. At a Glance
Tata Motors Passenger Vehicles Ltd — the automotive beast that built India’s dreams on wheels — has just dropped a quarterly performance that reads like a masala thriller. Revenue for Q2 FY26 stands at ₹72,349 crore (down 13.5% QoQ), but the real drama unfolds in the PAT column: a mind-bending ₹-3,412 crore, down 215%. What happened? Cyber attack at JLR, demerger hangover, and the ghosts of “exceptional gains” (₹82,318 crore!) dancing in the footnotes.
At a current market price of ₹362, with a P/E of 9.88, a book value of ₹301, and a market cap of ₹1,33,411 crore, this is no small fry — it’s India’s third-largest passenger car maker, holding 13.3% PV market share and a jaw-dropping 53% EV share in Q3 FY25. But behind that electric smile lies a battery of accounting fireworks: an ROE of 28.1%, ROCE of 20%, and an EV/EBITDA of 4.1x that screams, “Yes, we make profits, but also drama.”
Debt? Still ₹67,258 crore — but hey, it’s down from ₹107,264 crore two years ago, so technically, they’re on a “fitness plan.” The company has reduced leverage, increased capex (₹8,000 crore target FY25), and is preparing for its big demerger debut — splitting its CV and PV/EV/JLR segments like an automotive version of Karan Arjun.
2. Introduction – The Legend of Tata’s Four Wheels and Billion Hopes
Let’s rewind a bit. Tata Motors started as the humble truck maker that made India move before Ola and Uber existed. Then it turned global — swallowing Jaguar Land Rover in 2008 for $2.3 billion. Fast forward to FY25: JLR still accounts for 71% of consolidated revenues, proving that the UK subsidiary remains both its crown jewel and migraine medication.
In Q2 FY26, Tata’s financials looked like a rollercoaster ride engineered by Elon Musk. Revenue fell to ₹72,349 crore, PAT crashed into the negative zone, but the balance sheet still managed to flex ₹344,264 crore in assets. To make it spicier, the quarter included an “exceptional gain” of ₹82,318 crore from restructuring — yes, that’s not a typo. A balance sheet miracle that makes the audience go, “Kya accounting hai yaar!”
While JLR’s cyberattack brought temporary chaos in the UK, the India PV business continued to purr with the launch of the updated Tiago, Tigor, and Nexon EVs. Tata’s EV dominance — 53% market share in India — is like Shah Rukh Khan at the box office: consistent, electric, and occasionally overacting.
The demerger, announced in March 2024, is Tata’s way of saying, “Ab business alag alag karein.” One arm will handle Commercial Vehicles (TMLCV), the other will own PV, EV, and JLR — all to unlock value and confuse accountants.
3. Business Model – WTF Do They Even Do?
Tata Motors Passenger Vehicles Ltd (TMPV) isn’t just selling cars — it’s running an automotive empire. The business operates across four major divisions, each with its own personality disorder:
1. Jaguar Land Rover (71% of revenue) – The London-born, Mumbai-owned luxury child that still makes Tata look posh at global investor meets.
With brands like Range Rover, Defender, and Jaguar, it sells emotions disguised as SUVs. But FY25 saw volumes decline — Range Rover down to 161.3k units (from 201.1k), and Jaguar doing its best disappearing act, plunging from 49.6k to 19.8k.
2. Tata Commercial Vehicles (17%) – The hardworking uncle of the family. It still holds a 37.7% market share in India but has been losing ground (41.7% in FY23). Heavy trucks declined, SCV and pickups remained flat, and exports fell. It’s profitable, but the shine is dimming.
3. Tata Passenger Vehicles (11%) – The cool cousin, making EVs that actually work. Tata’s PV unit, with cars like Nexon, Punch, and Harrier, sells over 1.39 lakh cars per quarter. The EV portfolio, now 16,119 units (Q3 FY25), dominates India’s EV scene with a 53% share.
4. Others (1%) – Mostly vehicle financing. ₹17,884 crore disbursed in FY24, proving Tata’s cars and Tata’s loans are both selling briskly.
If the group were a movie, JLR is the international star, CV is the veteran actor, PV is the breakout youth hero, and the finance arm is the producer funding the chaos.
4. Financials Overview – When Numbers Go on Safari
| Metric (₹ Cr) | Latest Qtr (Q2 FY26) | YoY Qtr (Q2 FY25) | Prev Qtr (Q1 FY26) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 72,349 | 83,656 | 87,677 | -13.5% | -17.5% |
| EBITDA | -1,404 | 9,914 | 8,162 | -114.2% | -117.2% |
| PAT | -3,412 | 3,521 | 4,003 | -197% | -185% |
| EPS (₹) | -9.36 | 9.36 | 10.66 | N/A | N/A |
Commentary:
This quarter’s financials resemble a Range Rover stuck in Bangalore traffic — massive engine, but going nowhere. Operating margins collapsed from 14% last year to -2%, and PAT turned negative despite a monstrous “other income” of ₹81,507 crore. It’s like throwing a party where you earn ₹80,000 crore in gains but still end up broke.
5. Valuation Discussion – The Great Tata Triangle
We’ll take three classic methods to triangulate Tata’s “educational fair value.”
(a) P/E Method:
- Current EPS (TTM): ₹255
- Industry P/E: 33.9x
- Tata P/E: 9.88x
Even with a conservative multiple of 15–20x, the “educational fair value” range = ₹3,825–₹5,100 per share.
(b) EV/EBITDA Method:
- EV: ₹1,73,077 Cr
- EBITDA (FY25): ₹55,216 Cr
→ EV/EBITDA =
One Response
Great 👌