Will turn Tata Motors zero debt: Chandrasekaran

NEW DELHI: Tata Motors will restore the profitability of its automobile business and get to near zero net debt by the financial year 2024, said Tata Sons and Tata Motors chairman N Chandrasekaran in the company’s FY2022 annual report. 

The company has been a laggard among listed Tata Group companies. Compared to the record profit posted by TCS, Tata Steel and Titan, Tata Motors reported a net loss of  Rs 1,032 crore in the quarter ended March 2022 as against net loss of Rs 7,605 crore during the previous quarter ended March 2021. 

For the full fiscal 2022, Tata Motors’ net loss stood at Rs 11,441 crore, primarily due to low sales of its British subsidiary Jaguar Land Rover (JLR) vehicles. Tata Motors’ net debt shot up by 19% in FY22 to Rs 48,679 crore. Tata Motors’ free cash flow (automotive) in the year was negative at Rs 9,472 crore (as compared to positive Rs 5,317 crore in FY21), primarily due to adverse working capital. The business, according to the chairman, showed strong sequential recovery with positive free cash flow (automotive) of Rs 11,916 crore in H2 of FY22.

“Despite the margins being impacted by supply chain issues and runaway commodity inflation, our India business ended with strong free cash flows of Rs 1,879 crore. We are committed to restoring the profitability of this business as it returns to competitive growth and inflation stabilises,” Chandrasekaran said.

He also said that global operational challenges such as war, semiconductor shortages and the pandemic have accelerated some of the important future trends of the global automotive industry- from transition towards green mobility to the rebalancing of supply chains to become resilient.