During the festive Diwali session on Sunday, Jaguar Land Rover's Indian stockholder registered its biggest rally in a decade since notching a smaller loss than anticipated during the past six months.
Tata Motors Ltd. was up almost 17 percent to 148.11 rupees during its latest trade. Late Friday, the firm disclosed that it had shed 2.16 billion rupees ($30 million) in the three months capping September, compared to a retreat of 10.6 billion rupees from a year earlier.
Since failing in China and dealing with the fallout of Brexit's continued turmoil, JLR has nearly completed a $3.2 billion (2.5 billion pounds) restructuring plan which entails eliminating thousands of jobs globally, the carmaker announced Friday.
In 2008, Tata Motors acquired from Ford Motor Co. the Jaguar XE sedan manufacturer and Land Rover Discovery sport utility vehicle. JLR's annual pre-tax income was 156 million pounds.
"It's a company that's more cost-effective," Pankaj Murarka, Chief Investment Officer at Renaissance Investment Managers Pvt, shared with Bloomberg Quint, adding "JLR's quality for the next few quarters should be increased each half."
Every year, stock exchanges in India hold a special one-hour session to celebrate the Diwali Hindu festival. Since May 2009, Tata Motors has jumped the most. And this year, the festival was good for the company.
The request of Jaguar Land Rover cars is stabilizing in China, P.B. Balaji, Chief Financial Officer of the group, said during a media conference.
The company has faced reliability issues and problems with its retail network lately, and parent Tata has been struck by India's worst-ever slump in the auto market.
Last month, analysts at Sanford C. Bernstein described JLR as "seriously challenged" and said that Tata Motors should look at BMW AG as a buyer for the unit because the German company is "awash with cash."
Tata Motors disclosed in a recent regulatory filing that the company plans to raise equity through a specific allotment of stocks to the Tata Sons Holding firm.
Through a preferential allocation of ordinary shares to investors, the board of directors has given the green light for sourcing of Rs 6,500 Crore.
This will de-leverage the company's balance sheet, and cushioning the standalone entity's outstanding debt, and allowing it to focus on its long-term goals.
Meanwhile, the company is optimistic that the host of measures being laid out by the government, as well as its commitment to significant front-end infrastructure investments, will set the stage for a scrapping policy and ensure substantial liquidity for micro, small and medium-sized entities in the coming quarters.
Tata Group, the Indian conglomerate owned by Tata Motors, is open to finding partners for its business but is not planning to sell a good chunk of its cored manufacturing division, Chairman Natarajan Chandrasekaran said.
