Tata Motors shares tank over 8% after Q4 results as company remains cautious on demand outlook

The Tata Motors stock slumped as much as 8.3% on Monday to hit an intra-day low of ₹960.1 apiece on the National Stock Exchange of India (NSE). Interestingly, the share price had risen a cumulative of nearly 6% in the prior three sessions.

The Tata Motors stock is still up 23% year-to-date in 2024 and 83% in the past one year.

On Friday, Tata Motors reported that its consolidated net profit grew 222% year-on-year to ₹17,407 crore in Q4FY24. Revenue from operations increased 13% to ₹1.2 lakh crore during the quarter.

The company’s operating profit margin improved 160 basis points to 14.9% in Q4 FY24 from 13.3% in Q4FY23.

The company attributed higher revenue to growth in volumes as JLR production ramped up and the demand scenario in India also continued to be healthy.

However, Tata Motors said that it remained cautiously optimistic on domestic demand over the coming full financial year 2024-25. The company said that it expected the first half of FY25 to be relatively weaker. The premium luxury segment demand may stay resilient despite emerging concerns on overall demand, it added.

Tata Motors’ board of directors also recommended a dividend of ₹3 per share for ordinary shareholders (150% of face value) and ₹3.10 per share for DVR shareholders

A special dividend of ₹3 and ₹3.10 per share was also announced for ordinary and DVR shareholders, respectively, which will be approved in the ensuing shareholders meeting. The company said that the resultant cash outflow would be ₹2,310 crore.