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Jaguar Land Rover volumes fail to impress in March, down 8% yoy

Tata Motors Limited-owned (TML) luxury carmaker Jaguar Land Rover (JLR) has reported an 8% yoy decline in total volumes in March 2018.

The company sold 24,300 Jaguars in March 2018 against 27,820 in March 2017, a decline of 13% yoy. On the other hand, JLR sold 59,432 Land Rovers in March 2018 against 63,018 in March 2017, a decline of 6% yoy.

As per the company, sales in the month were affected due to lower sales in the UK, where the industry itself was down 16% yoy. The base month, i.e. March 2017, had reported a 21% yoy growth in JLR sales as had buyers rushed to buy vehicles before an increase in vehicle tax in April 2017.

JLR closed the fiscal year (FY18) with a volume growth of 2% yoy, with Jaguar and Land Rover growing 1% yoy and 2% yoy, respectively. Growth for Land Rover was driven by Range Rover Velar (sales started from June 2017) and Land Rover Discovery. Sales for the recently launched Range Rover and Range Rover Sport are yet to gather momentum. Among geographies, FY18 volumes were driven by China (up 20% yoy), North America (up 5% yoy), and overseas markets (up 3% yoy). Sales declined in UK (down 13% yoy) and Europe (down 5% yoy) due to uncertainty over diesel.

JLR Ltd is a British multi-national automotive company with its headquarters in Whitley, Coventry, United Kingdom. The company is a subsidiary of Indian automaker Tata Motors. The principal activity of JLR is the design, development, manufacture, and sale of vehicles bearing the Jaguar and Land Rover (including Range Rover) marques.

We expect JLR volumes to improve on the back of three, new launches over next 12-18 months (Velar, E-Pace, I-Pace, RR/RRS refresh). JLR’s prolonged volume recovery remains a key concern. However, margin improvement in JLR, led by cost savings (post commencement of Slovakia plant) and expiry of major portion of unfavorable hedges, would drive overall profitability.

Tata Motors Ltd is currently trading at Rs360.10, down Rs3.75, or 1.03%, from its previous close of Rs363.85 on the BSE. The scrip opened at Rs363.90 and has touched a high and low of Rs368.40 and Rs358.10, respectively. So far, 56,27,466(NSE+BSE) shares were traded on the counter. The current market cap of the company is Rs1,15,551.67cr.