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Tata Motors Ltd, the country’s largest vehicle manufacturer by revenue, will continue to witness sustained recovery in its financials in the March quarter as well as in fiscal 2022 on the

back of improvement in operations of Jaguar Land Rover and its domestic commercial passenger vehicle businesses, according to analysts. Stringent cost cutting measures, introduced by the

company across business verticals since FY20, will also lead to better performance at operating level. ALSO READ | THE FINANCE COMMISSION DOESN’T ROCK THE FEDERAL BOAT The Mumbai-based

vehicle maker reported a 67.5% year -on-year increase in consolidated net profit to ₹2941.48 crore for the December quarter as result of gradual recovery in sales of Jaguar Land Rover

vehicles in important markets like China, and improvement in passenger and commercial vehicles business in India. The company had reported a loss of ₹307.26 crore in the September quarter.

Consolidated revenue from operation increased a modest 5.5% to ₹75,653.79 crore. The topline improved significantly from ₹5,3530 crore in the September quarter. According to analysts at

Motilal Oswal, Jaguar Land Rover could surprise investors on the profitability front as a result of factors like targeted cost-cutting efforts to save 1.5-2.0 billion pounds, improvement in

sales of Land Rover, recovery in China market, cost saving on modular vehicles platform and its new plant in Slovakia where cost of production is low. “The convergence of the multiple

factors stated above could drive recovery in EBIT margins and leave scope for positive surprises on profitability. JLR’s targeted transition from the ‘push’ to ‘pull’ strategy for volumes,

particularly in China, would be a critical variable for margin expansion. We estimate JLR’s EBIT margins at 1.7%/4.6%/5.7% in FY21/FY22/FY23E (v/s -0.1% in FY20),” the analysts added. During

the quarter, sales of Jaguar Land Rover’s luxury passenger vehicles declined 9% year-on-year to 128,500 units but on a month-on-month basis sales improved 13%. Sales of the company’s luxury

cars in China jumped 19% on a corresponding basis as the economy seems to have recovered compared to some of the other developed markets. For the India business, which houses the commercial

and passenger vehicle units, revenue from operation jumped 34.9% year-on-year to ₹14,360 units as sales of its passenger vehicles zoomed and realisation increased from the commercial

vehicle sales. Net loss also reduced by 38.6% to ₹638 crore. “Management re-iterated its hard (ambitious) target of turning net debt free by FY24 and also laid out a strong market share

target in domestic PV’s of more than 10% (9MFY21:7.8%) driven by new SUV launches (e.g. Safari, Hornbill). Tata Motors remains the market leader in CV business which is witnessing gradual

recovery and we expect the industry to clock more than 30%CAGR over FY21-24,” said analysts of ICICI Securities in a note.