Q2 2021 Tata Motors Ltd Earnings Call

[music].

[music].

[music], ladies and gentlemen, good day, and then come to the go don't talk some more.

Do you do on these conference calls.

City mine don't Oh, well.

Participant lines will be in the listen only mode.

During the course of presentation, if any participants in benchmarks question.

It can be used to Jack ups option B. I think that.

Well do more discrete somebody took questions to the speaker.

Well the question.

At the end of the section.

Please note that this conference is being recorded.

I now hand, the call I'm going to what we took the gosh Monday. Thank you I know what do you still.

And what do you mean.

Yep.

[laughter].

Yeah.

[music].

Yes.

Okay, and do you see yourself.

[laughter] <unk> shares.

Yeah Yeah.

[laughter].

[laughter] yeah.

Hello.

[laughter].

[laughter].

Thanks.

[laughter].

[laughter].

[laughter].

It's going to be good.

How about you.

Hi crush.

Oh supposedly welcome all of you so apologies for that slightly delayed start <unk>.

Getting a few technical issues talk at all.

I'm sure you are able to secure them loud and clear.

It's time to say public statements I've seen that the only dr. Vincent I'm going to give a few changes that you have done in the in the definitions that on EBITDA.

Yeah, and free cash flow and these are basically to ensure consistency of reporting as well as ensuring alignment with other Oems what else there.

The big one would be on the free cash flow definition with <unk>.

<unk> and automotive.

Domestic free cash flows would be net of interest which is something with a geological is always there and we have no ensure consistency of the definition right across the competitive thatll be the belong to beat it back I'm happy to clarify offline any further clarification do you maybe need on this particular one.

Oh, well the next my Oh, Gosh, Oh again, an intense beautiful product launches during this quarter as well you've seen all of them, but he called out I would make in a sort of more because it's been on the CD side would be then so be it.

So with this example, 55 launch that's been a pretty tight.

Well for us in passenger vehicle that is okay for them. The numbers you already seen but might still have the 300000 MTR go under the old and the mix on TV. So that's something to celebrate a bar.

And in JLR, the lender wouldn't defend a nine do you know what we liberal policy.

No. It's based on 21 more near lost and so far this year. Finally, we have and a five m. have said also added to our portfolio Oh furthering on electrification drive for the next slide though.

Good twice I mean, it's been all despite challenging for you did you see I think there's been a significant improvement in sequence you for homes and even on a year on year basis, So, particularly the the decline in revenues of 18% notwithstanding a PBT has been managed to at reasonable limits.

Oh EBITDA decline has been reduced to just 160, bips and EBITDA breakeven, having achieved in the speed and in line with our be double digit commitment that people don't Bear Creek Basketball's automotive has been successful in selling that girls positive.

So all in a in a highly try and beat it I think I'm happy with the set of numbers up your book too.

What an exciting.

There has been this performance into what actually drove the bulk of it coming from a drop in volume the mix is compensated for the rest of the factor and overall on the profit double it'd be the big one that are that came down was JLR coming fundamentally because on a year on year basis fundamentally because of the volumes that you saw on the other came though.

Oh do you M.L. of course improved it and overall net automotive debt, there's no stock or so or Dunmore journey as it supports to go to.

And a and B, if we're going to use or the box, it's all going on across this quarter.

The parents strong overall liquidity has remained strong with maturities well spread out Oh. Additionally, on a minimal basis in JLR. We had an additional 700 million you shouldn't that happened in the month of October which further added to the liquidity, but overall the liquidity profile has been quite strong.

Let me now hand, this over to Adrian who will talk about JLR and Oh, well then in my stuff too early to talk about because oh.

He sees the business so having 60 days on the job over to you Jim.

Right. Thank you father, she good or good evening, everybody. If you are on the slides. So if you remember when we talked in July there were a few things we were signaling for this quarter and I'm really pleased most of those things that happen.

In fact, some of them more aggressively than we would typically you see here retail sales were a high as I'm quoting a one.

Significantly higher than Q1, although not as strong as last year. As we said last time revenues similar to that revenue was actually down 28% year over year, but significantly stronger than the previous quarter. We were profitable in the quarter that is something we will not.

Signaling in July and will take you through the reasons for that EBITDA back into double digit percentages, which of course is pleasing and also a very strong free cash flow, which we actually were signaling two months ago next slide please.

So these are the headline within the quarter, a significant improvement Q over Q, however year over year down 28.5% on revenue, China, China and you gave the two regions that I've actually returns to pre coated levels quickest and that a retailer inventories.

Oh, I am too ideal levels I'll take you through that in a moment that was another thing we signal doesn't intent in July I, five p. habs inside and have already added to our product portfolio in F Y 21, with more to come and I will take you through those in a few moments we were profitable. It's a said 65.

<unk> million pounds in the quarter some of that was exchange. So the EBIT was 0.3% a charge did its a good thing again 300 million cost reductions year over year.

So 300 million investment and again, we continued with CJ Olam, we check which was again for the second quarter running the break even levels. So that consistent improvement year over year continues in a joint venture in China, and then the 463 million positive.

She is I mentioned I'll take you through the details of that in the moment next slide. Please. Thank you. Okay. So I mentioned a minute ago, UK and China returned to pre cope with norms. The quickest that's very very close to last year's Q2 levels U.S. down about 15%, although there was a supply shortage.

Just to the U.S. in September so, we obviously looking carefully at the Q3 results, which we expect to be stronger in North America and the two regions haven't yet returned to previous levels are Europe and overseas.

No 20 will not be a P.S. offerings, a very important to Europe. So we're expecting better things in Q3 strokes second half.

The defendants are now being added to the overseas lined up and again, we will expect that to sales in the second half of the year in overseas regions, you see or you see that we already returning to pre levels next slide. Please if you would think you.

So just on this one by name plate again range Rover.

Okay pace show in the past and significant over Q1, but short of last time that the two cool ads on this page you can see the defender top right now they got in quarter two than any other quarter and we expect that profile of course to continue in the second half of the and we will have the defendant 90.

Right to the back end of this calendar yeah into quotes a full so those sales will continue to increase in half two very confident on the defend the project.

You see the powertrain mix that was I didn't know then had appealing to customers proportionately large take up about ice engines on now and have offerings and we'll get into some more details about later in the presentation next slide please.

Okay. So we called that dealer inventory in quarter, one because that's the deal is closed in March there was inventory levels increased we were specific with our intends to bring that back into control in quarter. Two we said at the time, we had 90 days' worth of inventory so 50.

Five days is the place we wanted to be really pleased with 54 days at the end of September. So again, you know we're getting in the habit of doing what we say, which is really really good at the absolute levels topline just the dealer inventories 60000 units. The bottom line is inventory on the way to dealers 33007.

Hundred units, which grew a little equal to two late next slide please.

Right, So where are we in the quota on profitability versus last year. Other she mentioned it was down year over year. These are the reasons why dramatic reduction in volumes and as you saw earlier, almost 500 million pounds JV position.

Hi, its improved substantially also you know the big news here actually is the improvement in the market place.

A a rapid improvement, particularly in quarter, two particularly in markets like North America, and a a headline via me was down to sub 4%. It's important to note that the underlying was mid six percents, so a little better than we achieved in previous quarters and the release here of U.S. residual value reserve.

Which we put in place we sold them Aki deteriorating rapidly in March April and May and most of those reserves have no actually being released which is a great sign of the second I'm not nice under the health of the market of course, a warranty we did have a campaign this quarter on the I. pace and all.

So in this time last year that was the reversal of spend on a p. has campaigned in China, which makes the warranty.

We are actually working with the supply as you know the supply network and trying to get themselves back into 100% operating effectiveness and valleys delaying our ability to take cost down in the first half of the year that will improve in the second half of the year also charge is done its stuff on cost control is for two.

Cost reductions significant improvements again this quarter, obviously makes it over year over year and the reason why we were profitable that Oh, a currency exchange is the sterling appreciated during the quarter, finishing just short of 130 and they gave a revaluation of the balance.

Which of course, we wouldn't be aware of the point we communicated in July next next slide please.

Okay very pleased with this slide we did say we will be significantly cash positive. We did say overwhelmingly that was working capital, which it was but if you go into that Middle section, we were underlying cash negative about 65 million pounds, but on 73 and a half that wasn't a delivery.

As to the marketplace that is a strong underlying performance. That's on your lights delivers sub sub 300000 units. So again, mostly because of the health of the sad, it's been strong which were not pushing volume don't forget we're pushing house of sale quality of sale value from sale, but also asked structural cost reductions.

I'll remind you two years ago I break even position was 575000 units.

This is signaling I break even position is a shade over 400000 units so dramatic improvement.

On the downside risk assessments that you can make on this and see you next slide please.

Investment 531 million again, I did say in July investment will be close to quarter. One levels. It was a shade lower you see where those investments where we have brought more of our engineers back to work at the back end of this quarter. So I do expect investment levels.

Actually to increase and the second off for the yeah modestly.

However, our full year guidance still assays, a stated up to 2.5 billion pounds and I think with 1.1 billion spent in the first half of the year, you'll see that we're actually in control of our investment spends next slide please.

Okay shifting gears, a little bit to environmental update none of this will surprise you I think the only surprise here is the speed that these things are coming out to potentially they will come not just to get an alcove it of course yeah.

In the winter period could get worse may actually you know again means some instability in people's lives and for US in production Brexit of course, the completion of the process on the first of January and there may be some friction in the border over that period of time, we'll get into that later well know next week.

Who's won the U.S. presidency, so that will come and it's very very quickly and you would expect the disruption we've seen in the marketplace off the back of all of these things markets moving quickly based on a single inflammation sets at the moment and that's just the environment. We will continue to operate within and I'll touch on emissions on later slides.

Next slide please.

Okay, we use external intelligence and information, particularly on volumes from I guess and you can see you know that mainstream cases actually a modest improvement over time in the market place is obviously it wouldn't indexed in overwhelmingly any offence I just.

Mentioned, but standing down down those binary impact we do expect a modest growth in our sectors across all of our regions going forward over the next 12 months. So I chest houses we should next slide please.

Okay defendant a marvelous decided to say we did say vehicle deliveries from the factory will increase and sales will increase also have September does have our second largest month in the UK in there. So the retail level of 7000 to 4500 units in September was a bit.

All right and the UK, although no deliveries are actually coming out to more consistently and with a 90 being up I did I do expect say it was a 45000 units per month.

Forward wholesale delivered to the market will increase as we start to fill and get a big kudos to the point of customer under the actual the older banks still remains very very strong. So we're still in a position of sales being sold out for the rest of this year I know what the banks not reducing.

They are actually increasing including the additive of the defendant on T., which goes and sell at the end of this year next slide. Please we are overwhelmed I'm pleased with defend performed thanks.

Next slide.

Okay, great tied to our lineup of new P. have these actually off our D. Seven eight architectures. So this one is the F pace and the fellow.

Big Interior upgrades also so we think these vehicles will be very appealing, particularly on our UK and European reaching so we are expecting these to underpin sales growth in the second half of the year and also compliance right emissions compliance also will be enhanced off the back of it.

Well next slide please.

Right, So where are we overall on an line up from a p. have an enhanced perspective. Each time, we told you about this more the cup. It's come off there's only one can run one vehicle left from the P. has we will announce tomorrow we are.

Actually I think the p. have to the pace as well. So that's the cover that will come off and then later in the year were announced a second additive in the N. have range I'm sure as you go through all the vehicles, it's becoming more obvious which is that one is I'm not in a position to actually say that second and have today well I.

Most of our range now is in place on our second half of the year, particularly cool to somebody will be determined by the pace of bringing these vehicles to the market place, particularly the UK and the European region until then but to quantity to quality to quality, we will not compromise call.

The t. for speed.

We will get these days it was right before we deliver them to the next slide please.

Oh, okay.

Okay, So where are we overall with our compliance targets by region lots of Green on the page. So let's focus on those I'm actually going to focus on a UK and Europe for this calendar year.

Part of the delivery of those up he has particularly to the marketplace, which as I mentioned in July.

Oh and have been impacted by the Cove. It delays they will actually be delivered to the market place later than we originally anticipated as a result of which we yeah I did within our quarterly results first of all and our end of quarter four results last year reserves for potential fines will.

We need to pay in UK Europe, we built those reserves up to 90 million now we will be compliant in Q4. This Q4 calendar year because of course. These were assessed on a calendar year, a fiscal year basis, and obviously the components will be dependent on the number of registrations for the new P. have well also.

The I. paces, so for the moment the reserve level is adequate.

Were hopeful in the balances this quarter were now in those reserves will start to fall we have a compliant lineup in calendar year 21. These are calendar year to date fiscal year day.

And so it's just simply a case of quality delivery of those vehicles to customers hands, which will progressively happened through this quarter next slide please.

Off the back of that I wanted to remind you. The journey we've been on our target was a 45% reduction from 2007 levels, we will be at that point when we get into next calendar year, we're progressing to that point quickly in this quarter, but overwhelmingly we have a compliant fleet and how are you.

Okay and European markets post introduction of these final he has so great job by the team 45% reduction in C. O two over that period of time next slide please.

Okay, I will get into Brexit I'm sure in Q1, I just simply to say our base case is still that there will be a deal between the UK and the European Commission I.E., we won't trigger a W. T O tariffs, that's still becomes our base case.

If that's that becomes true then a deal is very similar to the Canadian position. We expect it's there's no deal were expecting something like the arrangement, Australia has with the European Union and I'll get into the details and what that means again as we talk about it most quotas within a cue in Asia.

Anyone want to Oh next slide please.

Okay. So charge is done what it does best you know tight controls over cost and expenditure. It's done so well people are starting to ask how are we under investing we don't believe so we think we are appropriately investing how we will appropriately grow the speed of that investment.

Resources come to us over the balance of this year this quarter almost 600 million additional savings don't forget last quarter. We did 1.2 billion. So in total in the first half of the that's 1.8 billion.

Well its a variable profit cost investments and inventory reductions we have made all measured on a year over year basis by the way. So this isn't notional internal stuff against internal targets. This is measured versus what we did in the prior year looking forward we confidently.

Lee again would say that the two and half billion pounds target for this year is absolutely within reach and.

People like to ask why it's going to come from you've seen in the courts. It too. It's about 50 50 investment in cost in profits and that's broadly the its place. We expect going forward also were mostly done on investment we are at that 3 billion level at the end of quarter to the next slide please.

Okay. So just a quick summary, overall I don't think there's any new points here for anyone or the Investor day I draw your attention to a Ford Jaguar land Rover when looking at the Investor day on the second of December went to the second December and we're really looking forward to answer said.

Just a quick discussion I'd like to ask T. I read to say a few words I knew C. O T area. If you wouldn't mind, you said a few words to the investors.

Sure. Thank you very much a drill well Hello, everyone. My name is Chile, It's my pleasure.

Just my sense is you said you said you Oh, sorry was on today.

Well it goes without saying that these are unprecedented times with the health economic impacts of COVID-19.

Compounding the challenge is presently facing the industry.

Yeah, Rob This technology contention political then tried them subject to such as Brexit. So you can assume.

Oh weather Jaguar land Rover is and I couldn't company with strong brands and talented employees to manage through these stars.

Jaguar land Rover generating a profit I'm supposed to cash flow. This quarter is a testament to this and I'm confident.

The business will achieve a feature of long term sustainable profitability.

I know many of you would like to also.

But to what do I think about the company cohort changes I might like to make a.

Our weather Oh, I just joined the company in September, but I'm still in the process of we're doing the business with the management team.

These today.

Before the end of the year and I expect to be able to save more to you.

About my vision for the future is called recycling business. So I look forward to speaking to you again thank.

Thank you very much.

Thank you. Thanks, Yuri Oh, we lost you a little bit towards the end basically his main point is oh, he would be very keen to engage with so all of the messed up on the Investor day that itself could do conduct December so look forward to seeing you there that is a basic pick up.

Okay moving on Uptravi character. Thanks, Thanks, Jody so moving on to tell them, what the domestic business. So a strong sequential improvement in performance.

Year on year growth of 3.4% or more the almost entirely led from the new.

<unk>, Oh revenue down, 3% and BBD broadly in line with what was that last year EBITDA of course, so what I really would love to call your attention to the EBITDA improvement by 40, bips or despite a the so holding the revenue line disturbances I'm Gonna work, that's happening on the cost line and EBITDA improving by about 300 bed.

And again, a reassuringly free cash flow after interest after the new definition. So all the direct two columns three and across its likely.

Oh performance pilot right, if I'm right. So.

Wondering when do things is definitely there.

Phebe, a gradual improvement in demand I mean, but improving markets.

Hi, Thanks, good laser and the other call out.

<unk> remains weak obviously, improving within the month of October compared to where it was earlier, but still a long way to go in terms of the eight Eagle Oh.

No because of course has been on opposite or boy, a very strong sales momentum coming through with.

For new units increasing market share.

Oh EBITDA sponsor for Tata Motors, despite of becoming a which is really not what the given what's happening to the core quite TV cool sequentially.

Oh, Okay. So if you're asking me earlier into the PB EBITDA breakeven not to report has been achieved.

Probably the highest or whatever for quite a while.

From a free cash look all the important don't forget exactly.

So that's you're already seeing so I won't spend too much time on this I think for that other than works almost like weekly.

Oh free cash flow again, we've talked about so no further comments on back you can now.

And we went to the commercialization.

Not something you can skip the site.

[noise] scratch savings on this point in the five minutes. Your Oh, we have called out of the call them for cash savings and again I'd be a bit of a 2475 and as we look forward into the future. We are confident of delivering the 6000 gross I expect a bit of a movement to the numbers between investment and working capital because we are.

After being a seeing a very the surgeon demand, particularly coming so wouldn't be so we just need to ensure that the capex is managed prudently while catering to that resurgent demand. What we would have done it was self imposed so you're confident all over it and of course, Boston proper is a very strong eattwenty close deliver which is reflecting in the EBITDA improvement as well.

[music].

The commercial vehicle side or market share at 36.7% or eight of starting to improve month on month every month, you're seeing an improvement in market share ultimately coming out of supply chain issues and he said like most Corbett ER eminent city has continued to do well up 60% year Oh, the call out as long as one commercially.

So bad we need to go into a ship and the.

The recent a win that you had a 6400 vehicles for the acquired under British Civil troublesome for something which will be a follow up like Saudi will be something which examples there but more than that you will see a lot of work happening in the second how youre as the supply chain stabilizes. It the real color to CB passenger with Emtrol give you sort of talk later, maybe don't see.

Much happening in this particular segment because issues like working from home I was going to school not being that I'm state comes for undertaking start having the monies to buy.

Oh.

On the financial or the the overall, despite it being a very big mix because I didn't see any within commercial vehicles have actually been not decline even further oh, despite that we have improved our overall low pollution.

Pollution in terms of revenues and reduce your friend retailers being higher than study wholesale being higher than retail traffic build inventories supposed to be a thick and all EBITDA, 3.2% just reflects the oh.

ER situation on that makes life.

Forward.

Oh on the CD market, a bit I think Oh I'm sure good he's going to talk about it in the Q and able to quit calling up there a good issue you want to take a minute on that.

Yes, I'll, let you take or be on your today.

Hello.

Yeah. So.

I think it has the ability to go frankly no [noise].

Have you seen a.

The gang happening across the segments that you see.

You bet.

Segment has declined by 73% in.

I'm going to see mid 39% I see but any person and it's even I think the good thing is just too.

Like these declines.

At a far lower than the Q1 decline.

Oh, So you can see it was in Q2.

Well you have a September this decline is introducing they can do and when you see for that matter.

Well for the quarter. It was a 39% to Glen for the month of September It was a very low single digit decline. So I think gradually the volumes are picking up in the other.

The segment's insidious pickup in fact was hiring immigrant years comparison from a Nike.

And as a result of loose a small commercial vehicles become so use has actually gone up by almost 50%. It would snow. So when you put it in this quarter.

Some of the good things that you see.

Ah Michael Lewis you, maybe use some of the moves and you see the elections are going up.

You can imagine is gradually green and 60 minutes that we track or customers in all the segments have also been going up and essentially was in there as well.

Were optimistic about the future, although not so satisfied with the current status.

We'll be mindful of those movies is going and is very strong.

We'll see we'll only happening in mining as well as infrastructure projects, especially driven by high rates.

And I think I've used six range has been really really well across the range.

We have seen a fuel efficiency and youve been <unk>.

Which is leading to a very good well if you recall in the minds of Uh Huh.

All the challenges that before and I think commodity prices as far as what do you mean.

I normally the precious metals, but also let's see lumps equals Oklahoma.

During the month of October some of the challenging and I.

I think on passenger bloody already spoke that generally the demand for passenger is very low because she is not working and.

Employees working from home.

He's asking to go to the next night.

[noise]. Thank you. So I didn't want what is it that you've been doing again, you seemed buckets that you spoke about in the last month.

So in terms of the much admission I think as the well really density reducing the north was on.

Grown activations.

Back to back trials or the views expressed <unk> superiority.

We are pushing on value added solutions and then it is likely that means you are because oh I can guarantee you turn around and getting the extended warranty using a lot of these I mean.

Appreciated by the customers if you do you see that.

And I.

I don't see a lot of work is being done by loosely or new things isn't inches across and a lot of good schemes have been brought up.

To ensure that you might have already great little abuse, what are you doing.

In terms of the monthly finished Oh, we keep your focus you have on that.

The bottlenecking the supply chain and we are working on ramping up the supply in any one quarter. One it was a good improvement would do happening in though.

Oh, no. We're also driving a lot of flexibility manufacturing so.

What exactly do you do little for wood flooring locations and a high spectrum, which I think you get in a position to then shift so the production of well some various locations my relocations and just want to get this impact.

Let me get on so even though everybody loves to see this well respected you might be.

We are also having almost no d. season operations, many others to ensure that there is a good range between the months what cost kind of walk me anywhere display.

I think cost reduction cash conversion I suppose, but I can tell as you mentioned I do want to spend more time, but all our cost reduction initiatives remain on track and in fact now you're focusing on.

Assuming the gains in the fixed expenses, although the skill whole person isn't using and coming back.

[noise] equaled 11.

On Capex I think we continue with a choice for deployment only are you using when you are spending the capex, but in other ways as Gordon or the media.

And yet working really really well looks like it was just like to use cash flows.

Well, let's get back to you.

Yep, Thank you Uh huh.

If you look back to commercial vehicles is going on the passenger vehicle.

<unk>.

Called out there was a 7.9% market share for a long period of time. So so this is now starting to move as we had said to watch this space.

All the four main plans that not all of that geography or across Mexico and of course, how do your starting to know really well and Irish I'm sure. It was going to talk about it in the Q enhancement.

And between how do you determine how close are really seeing momentum pick up in this particular segment to be somebody tried waco that he put out that about funnel make architecture and therefore on industry growth of minus like people have been happy to see opposed stockbroker lets them. But then so this is quite not what people thought does include some locked on video so despite locked down so I'm pretty charged off were going about.

But then growth.

Next on TV is almost 61 because of industry wasn't tomorrow or was there any spot market share. There. So the clear focus on re imagining babies, starting being able to vote and is also showing in the piano what are the next likely.

I would add though this was a wholesaler hundred and 7% growth retail or 73% and ER or absolute number of all more than 100 welcome aboard as only inventory being built anywhere you don't have it in country at this point in time and revenue up 4000 Boes for this quarter was a though the higher what many many quarters that a little bit and EBITDA at one point.

6% of extremely a shortening of the business.

Back in to what it was before it was not a flash in the back.

And Oh, what all next target is not to get there, but the breakeven and then to cash breakeven, which is what we are on the call.

<unk>.

Well, let me hand, it over to Shallish for a understanding of what's happening and what's what's driving the step up in performance trends or would you.

Thank you energy also some of the key actions that we took to cable.

Also in Bloomington seems that you have seen in the last six.

Six months.

So simple also was all the focus on repaying window seamless demands to play some conversation.

This is very essential to ensure its all statue attestation for the veto, especially because the times although.

Otherwise it would have been a problem, especially in the recent months, but this is what led us to absolutely I need more production to what was needed in the market.

And this ensured that though we remain convinced this will be doubling of workloads are looking up the capacity of the b malls.

The second ball.

Most important action that we took was to.

Increase our share of voice video.

It relates to new ideas and interviewed though customers in need.

Peter It seemed to me that deal business with almost no, but I thought it was very useful.

That's why we took all that will go higher in channel Wise, Oh, right from Jamaica say.

And that has had a school model means diesel.

Redness, but also continuation of all our calls and as long as you mentioned that it is not a studio both one paseo so each and every week on a phased calls that he has an opportunity some of them who are not blue belt. So the agriums onsite I'd really like I said as that fund is consumed in the market.

The total action that we took was a significant can you have to leave ample davita policies incentive structure.

Oh, which enabled us significant jump into profitability.

And they will significant said she will be missed we wouldn't <unk> profit to be.

And I'm very happy to share that now majority of all be less profit to me with the kind of growth you have seen and good traction on the Beano policy change that we have done much maintenance into my teams and also revamping the incentive structure in which was related to the gold that he wasn't cutting capex specifically.

India's lake or some of the tenants are Jay said in the portfolio that you're not doing well.

At the same time, especially with the on the DC portfolio also.

This has really the best so you know Jay traction and also has set us on booking new generation is concerned.

Oh, the full production was on the digital as you know the things off and then make all the customers will not be any two inch it out of their houses and goes into showrooms. So digital was the important so something inquiries and because.

Similar actions and especially the pet food.

Who plays initiative that smoke could though have you done we do bushels. So it could get any most of experience and more on the bulk of that though you know, it's really cool, Florida online bookings photos. So and then beyond that we are also looking a little bit he holistic initiative, which in turn.

Seamless digital experiences for customers in that entire journey.

The last one is a focused woken insulin and nutrition keenly chemo picture just wouldn't be open making more kids Lucky decide and then assuming Stapleton you shouldnt. It initiatives that we have taken bichon pizza hyperlocal marketing than focused marketing activities and it takes 10 minutes a true I know someone still.

Well, you know marketing for the markets and.

The more expansion what is emerging market.

Okay expansion. So these are the sort of initiatives, which we have taken.

In the last 456 months, which has led to this kind of performance goals.

Okay got it. Thank you. So what are the next lightly we want to Tata Motors finance, the one area, where we did the right thing you'd want to watch what September one particular month, the number of told him that.

You got it again happy to see that Ah things have actually been better than work with anticipated the know how to see market start improving to 37%. We are cautiously been more TV markets trip, you up because public sector Bank, Oh, absolutely picking up for a stronger market check on P.B.N.B. never never be comforted to them. So.

CD market share was something of a.

Sure actually deploying all monies.

Or with a P to heal a positive BBD, despite significant or at least coming through and overall GNP at 4.3% or below what it was last year. Despite moratorium Oh, it's something that is very reassuring Oh and therefore this focus on cost and commercial focus on efficiency has really helped us.

We are now at 44% down from the highs of 70, then the puppies North part and then I'll below at 44 unopposed liquidity has been extremely strong understood. So no concerns on that front. So overall, how do we at this 0.1 of the things a little more toward double digit auto yeah, that'd be taking that business in terms of its.

Deficiencies and its disposal.

Forward.

Looking ahead or you have seen the slide on the key call out I would have a second half is expected to be much better than first off as demand improves and a.

Focus on cost and the cash continues to drive a harder and therefore, we are absolutely committed to de leveraging this business over the next three years and become sustainably cash positive and the focus areas are there for all to see no new news there other than a glint execution authentic fighting portfolio and continuing to manage costs tightly.

On slide in terms of Oh that is then obviously be a more deeper dive on that there's no strategy post covered boughten T. M. ATV JLR the substance like end of December and look forward to seeing your there, but let me hand, it back to you for any question off of it.

Okay, Oh, I think we already start seeing no questions coming through on the on the moderator views that video stream light weighting. It does oh, the chorus call Oh front of some promote kumar of Goldman Sachs. Congrats on a great performance.

What is driving that the court is being gross margin and are these sustainable at current levels number one number two can you. Please provide an update on defend a customer order book and explain the gap between wholesale and retail Toby Keith since launch and three a what are you going to do that as market share declines across the city segment Steve.

Medium and heavy commercial wafer so it didn't kinetic item, one and two and beauty show called the Diverters I can see.

Yep, Okay, Hey, thank you for the questions.

So margins I think I'm on record, saying look we're looking for <unk> growth the health of our knowledge and rather than the quantity of sales we've taken.

A number of actions, including making sure.

With the older stuff than we had in the marketplace No from April may and June, including making sure that we're only building costs that we needed to build so we brought our plans back up to speed based off of demand led recovery starting off with Nitro, which fills the defender of course on the discovery.

And at the same time on the 18th of May we brought back I saw the whole plans, where the range right was about the quickest region to come back has been China and that's why the year over year performance in China actually in the quarter has been good I.

I think you know we sell more of an Irish she will be five units in China and therefore, the margins are healthy yet on those units from China. So the regional profile of change and growth back has driven a strong margin performance.

For us in the quarter also.

I refer back to some of the the M E U S residual value reserve releases 64 million pounds, although we've had negative headwinds as well, which to offset those reserve releases, including booking an extra 38 30 million pounds just over.

Just in case, we don't get those P. EPS to the market place within our compliance cost reserves and also you know a difficult performance on cost down for supply. So overwhelmingly the underlying left the average house sale, particularly because of the speed of return to sales from our China region.

Defender.

Of course, you know defenders, an all new vehicle and therefore, there's a lag between production then into wholesale then into retail as you know the older banks would tell us we don't yet have enough cost actually in the customers' hands or to the face to the customer that Paul I do expect does not get they will top.

Delilah wholesale was well be higher than our retail it's because of course the car has to go through our own hands into customer into do you listen into customers hands that will continue a little bit into the second half of the yeah, well a lot of that is in place now owns the defendant 110, we will.

During the defendant 90.

On stream later in the Yeah, and you know you will see the same profile production in the early days will outweigh wholesales and they will be higher than retail was because of course, we have to get in the bay cools down the line to discuss the times again that will level out I expect in quarter four the big message here is there's more demand than.

Supply at the minute and that was all the banks will stay strong you know throughout the balance of this fiscal yet and that's good healthy sales is while the mix of sales that the customers are ordering off stronger than the mix profile as we anticipated when we estimated the initial six months worth of sales.

So it was nothing extraordinary happening apart from attempting to get those vehicles into customers hands as soon as we possibly can.

Thanks, and then getting to where you want to take the question on what are you going to do to address the market share declines across TV segment. If you can maybe question.

Yes so.

See this market should be.

Claims just didnt there is essentially due to the supply side constraints I didn't realize.

My plans are in terms of for new mines innovations have been quite good.

And you can see the month over month markets, Yes, I think you're consistently grown starting from a mid June onwards, as that you'll be able to make those have increased that to be.

He wasn't digging up the supply chain.

You bet. If you got to do is I'm going to lose market share and I didn't hear almost close to what you had in September 90. So we continue this journey.

And as we know I think the marketing, it's too difficult industrial Union issue is going to be more than double what it was in each one and just what are you going to use somebody would partially due to go to this as the supply side constraints on it I.

I think some of the key factors that drove by let you also mentioned I think.

The key here is going to be actually the small commercial vigilant because ER segment, then the ceilings as it used to so we can do better and therefore any losses actually gets and you recall that the the all business units.

So here not only use the pipeline that he didn't market would also be you think you backed this order from another position is well placed is around 6400 weight does.

So all this is the bottom for calculation, which will help us to get the marketshare back across all the segments I know you people towards the beginning of Stifel.

Well, let me.

Got it.

Yeah. Thank you second question comes from for the call down on R&D Mitchell Fun, Oh first question or just security or is there a need to deliver the JLR nameplate stopping the brand positioning or Jack what in your view what do you look at pruning the product portfolio stuff that might models don't cannibalize each other or let me respond to that I think I'm serious.

But the scheme to speak to us on the second of December.

Every week for that formulation that we make up his mind on this would be my response to you over the peak.

And Christian good interest to you can say that can you talk about the outlook for a minute to be and how does the confidence come on C.D. operator internally to our model is hopes that moved in.

In terms of automotive of leading into predicting I mean, the barn, what are they indicating.

Or would you want to take that respect Krishna and pick it up after that.

Okay.

So.

You know some of the leading to get those long for me to see that you look at Oh first of all of it was no.

Well no spends this is happening on the mining and infrastructure.

As in school.

Ecommerce.

Thank you we'll move what does it mean no outcome from steel and cement industry. I think these are some of the leading indicators that you're looking at and the good thing is most of these indicators seem to be doing with number one number two.

I think the gradually when you do the utilization of the seat and completeness of kind of firming up would you look so good I mean this is something that you can see from the EBITDA.

I just have another good indicator.

I Wonder if you could do that we track internally use the.

Sentiment index, the consumer sentiment index, so to say, which is almost could be finishing off well.

Second sections occurring.

Oh skaters as well as future expectations in that you see is when the current status is you slightly lower Q1, what is the future expectations have significantly which means that you are looking forward to that.

Business to grow.

As I said are you in the first quarter from the emergency said many times the grown by almost 90% in.

In Q2, you see grew by 39, 40% what do you think or just the month of September I think you do do you buy only 3% to 4% so gradually medium and heavy commercial vehicle well.

Volumes are growing and not catching up with what you had last year over the last few itself was.

I will make up the plane order your previous to that which was high so I think more on some of the indicative.

I think it has been falling in place and we do see that the medium and heavy vehicles. Good ones. Unfortunately will gradually as we go away.

Well, let me.

Yeah. Thank goodness.

Another question from Sam.

Hey, Matt how should we think about it.

Capex over the medium term.

And that doesn't get sick federal work and major platform investment and BB or also done, but I presume that for Europe.

Our domestic and here.

The profit that the investments will continue to remain tight.

And at the same time, you don't want to lose the market because of Ah capacity constrains or anything so we will be very choiceful about that but I don't expect.

Coming through here, so we should be number on the books boxing that cater to Golden predator football them cross kind of range.

Because you also have a very clear imperative of de leveraging the business. So I keep saying I know well be able to talk to talk about free cash flow generation to pay down the or that there's one more reason why we changed the definition of free cash flows to net off interest cost. So we know that that money is available to pay down the debt and therefore cut back capex.

I will be your derived number from that perspective at the same time not compromising on growth.

So let's move to the next question that's from Sonal Gupta you'd be it.

Hi can you indicate more color Shadow bank and we have it.

UK, plus you want or right Wendy rocket.

You are provisioning for some fine for JLR in terms of meeting you see what the targets.

Can you indicate what was up to work.

Also to meet the 2021 target what should be the b have better share that you need to achieve.

Thanks.

They didn't want to pick this up.

Yep Yep. Thank you Sally she and thank you for the question also so you know the day two we show you actually in the presentation of course is global 3% and 3% normally speaking if you divide the world into five incredibly say each ones effect you know this 40% of I'd say it was ultimate.

They will be UK and Europe. So 3%. He had you know times it by two and a half you get to say seven or 8% in the marketplace that will increase as we go through into next quarter as we release, the perhaps into the market of course, and you know we broadly give good guidance three or four years.

We've given guidance that a you know we expect these to be up to 24, 25% of our let's say it was the level of increase of course is important and you know partially that will be driven by the speed of those vehicles to market, but I would anticipate double digit percentages for both.

We have and a bad in the quarter three period of time.

So 11, 12 13, 14% levels of those sales will be p. have stroke, but have you when it is our expectation in Q3.

For beyond that yes reserves grew to 90 million at the end of September are you know they were just about 60 million at the end of June. So we increase those reserves by about 30 32 million actually in the quarter 58 to 90 million, we do expect that to come down.

In Q3 fiscal I eat the balance this calendar year, but it really depends on the releases that was because as I mentioned earlier.

Thank you. Thanks. Sandra next question is from Yogesh Aggarwal of HSBC again for JLR Adrian coming to you do you plan to move ICSI and E based on the M&A platform over the coming years.

I can't comment.

Okay.

Or not surprised marketshare continues to fall in China.

Reasons behind that.

And I think you already answered the question on provisions or to clarify yogesh. It as part of the piano of this particular quarter, so nothing outside the piano.

So can you take this question on market share in China.

Yeah. So you know this is China is particularly we talk about how so sale rather than quantity of sale that lands greatest in China. We've been I think would show you in previous quarters Weve really been working on the house of sale and there's a number of metrics that we use to show that were there.

In our China organization, including where we sell the vehicles localized sales rather than actual rather than.

Localize sales rather than an absolute number of sales that were up to 90% on that metric, including the level of inventory that we actually have.

Have in place I, Tellez, which were at 1.3, and 1.5 months on that metric and including where we actually sell the vehicles in the responsible arrow at 93% on that metric. We also have return on sales metrics, Fred dealers, which we want to be of course.

Positive dealers like to sell that you'll caused when they make money and we returned to positive territory at the dealers in quarter three as a result of that house of Seo drive, we actually reduced the variable marketing support we put behind the units in China import business to around five.

5% underlying in the quarter. So we're about half of sales you know the ashu Besides Iraq.

Highest selling units within that import business and we feel the size and the scale of the business with those two vehicles you know in the seventh and eighth year that life is incredibly rich at this point in time and margins are incredibly strong from China. So we're very very pleased where we are in China. We think we can do better.

Going forward by driving those metrics you know we said deal is a target we expect them to hit that target, we expect them to sell that car locally rather than outside of that region. We expect them to be profitable and we expect them to have lower stock levels and we have delivered all of those things again in the quarter.

And delivering those things we are less sensitive about absolute share of market or that we think we can improve that going forward also.

Thank you.

There's a question on strategy to the CEO want more modern from the only or less Oh, you'll get as I said, let's let's keep this question for December 2nd.

Our next question comes from certification engine rollout of enterprises, how important are the coverage policy.

<unk> can I ask you to take that question.

Yes, well as you.

So.

Maybe for commercial vehicles. This package policies, indeed, you really important.

You seem right [noise].

No you know.

Well the government needs to be made.

In this in Morocco.

And so it is excellent.

Okay.

Oh no no replacement demand has been no.

Good morning.

[noise] Yeah, no no I mean, that's the one coming up yeah, just snap as well I think it all depends on what we see is going to be among the bank.

[laughter] Oh, you do lose these WAAM Mark when you number of years. So you know the weakness was on hate us expenses are making.

And his assessment business conditions and safety.

And if the vehicle is home to be.

Not we think some of the known then I think you'll be subjected to some distance to do everything and be forced to steps. So I think this is mark you got is just on TV.

He should produce.

People, who you were.

Good Bye health assessment centers across the country as well as.

Yes, it does.

In an organism and across the country. So we are you looking forward to just got responsiveness is really nice some oh replacement demand does not in good order last year most of you know.

Utilization was low.

Valerie.

Yeah, Hi, Thanks, Rich next question is coming from Chirag Shah anyway.

First on Brexit what models, you'll make today you, excluding UK and what more can be made that you are forced to.

And what kind of in that spend will be needed for that.

Oh, Yeah, maybe taking one question for them and then another question about their drug you had oh.

Okay. Okay.

Thank you thanks, Patti and thank you for the question.

So our need for plant in Slovakia, we build the defender and the discovery models allow Magnus style, yeah. They would on abbey halt in grants in Austria, the pace and the I pay so those are the models today.

We currently built within Europe and of course, you know that they're shipped globally, both to the UK and across the rest of the world I don't really want to speculate about wanting it would cost to ship to other models to other plants in Europe or whether without the intention to do so you know.

All of these things are possible anything we would talk about strategically from a model footprint perspective already which particular models, what we emphasize more on going forward rather than less and you know these are the types of questions that we may choose to get into his departure at the Investor day. So speculate.

What we could do you can do anything right just cost a lot of money to do things. So it really would be an assessed return on investment, which we wouldn't do without clarity of actually you know what the trading circumstances are likely to be going forward. The good news after a long time not tired he should come at us very very quickly.

In the course of the next 60 days.

[laughter] second question sort of strategy and portfolio mix I'll Skip that question I saw in the third one was from here on water drive free cash flows working capital Walliams or profitability in terms of order of priority. So let me take that I think the one that you see and then it's also talks your next.

Question, you have today or the working capital Oh back that you saw this quarter. It was actually a correction of the mine that happened in the previous quarter and we called it out explicitly and therefore going forward working capital what could be the main driver.

The fact that you're sitting on a negative wasn't never to the extent of growth you will always see some working capital kind of cut it coming through but nothing more than that the main driver going forward will be combination of volumes and profitability offset to adding the profitability the basis actually starting to get that to some extent some of the particularly the material costs.

Savings in genomic come towards the end of the year. So there will be an improvement there, but well just have to start coming through the suffering of the free cash flow just like you see the kind of compare them today, the operating cash flow less capex is noticeable documents to start turning positive for us to become sustainable. So that's all what you're focusing on.

This adds to the question on your rising payable it is not a rising payable. It is more a question of we have a.

Industry norms in terms of what the payable days and we don't intend to go beyond that but at the same time, we need to have a rightful payable this particular market.

Jana Marketshare and the second question is on JLR market share how do you look at it in the past marketshare, Spain to eat adequate profitability I didn't know if you want to comment on that.

Yeah I'll go back to the previous responses were very very focused on how some sales of course markets market share is an important consideration also but houses more predominant. So we have over the course of the last two to three years actually is a part of the charge program started to takes.

Some people are trying to model offerings, which were loss, making you know and we will continue to do that we think most of that is now actually where it needs to be and you will see increases in volumes going forward and also increases in chess as well.

The last question again, that's something which I lost the question, but I'm push it into the December 2nd question Mark beds, you seem to be focusing more on P.S. rather than if.

Compared to your peers or announce it's either expected launch isn't set aggressive targets. It didn't really want to take this question or deferred to the second.

Yeah, I mean simply put we have different targets to a lot of our competitors of course were smaller volume salary in UK and Europe. This interrogation value up to 300000 units. Our strategy understandably is very very different to our competitive strategy over the next five or six years through to the late Twentys Twentys.

It means we'll just do things differently over the next phase because it works for us they will have to do things more aggressively that will drive competition between themselves over the next five to six years, some of which we will need not need to get into the rest will cover the strategy day.

Great. Thanks, and then someone of the next question. It's from couple of saying a nominal waters JLR best strategy, how do you plan a vendor the plan more bev launches.

Competing lunches are coming over the next two weeks I.

I think it didn't just answer that.

Second the waters or maintenance Capex of JLR and deal what are the key reason for increasing Capex guide for.

Our next year and it quite often for the India business, Oh, I think the maintenance Capex, if you're talking about or if you feel if I understand you right. These are the kind of what you're seeing that.

The level of Capex that be below which we cannot go I think post covered the numbers that they put out the score probably pointing to that below that it is going to be difficult for us to be sustainably are sustainable.

We may not have the models and growth does come back. So therefore, we believe at this level.

We are really scraping the bottom and as far as India is concerned all we're signaling is that capex and look at dynamically because if you're going to see a 100% kind of growth rates coming to BB with a moderate mix changing towards the tone you will need to do a few corrections out there, but don't that none of this changes. The fact that our main focus is to do.

But as the business and therefore capex will continue to be the need for capex will be significantly higher above inhibitor. Just capex, we can assure you that.

Oh randomly calling for Watson of residual values on the U.S. market in general you want to pick that up.

Yes, that's a part of a it's supported by the V. I may of course releases and its on the balance sheet is in its you know the provisions.

Got it thanks, I'm going to the next question, which is from GIC Nash or Jinesh Gandhi on more close for a for JLR any further follow benefits expected in the third quarter are you looking to reduce further inventory at the dealer level and walk spoke does that reduce the I mean, some of the underlying the EMEA up 6% in the second quarter.

So overwhelmingly the furlough scheme is coming to an end as you would know in the UK. We had 2500 people I think it was in October on the scheme. They will progressively come back into the business during quarter three VNB levels in quarter three.

Well of course were extending the ptwenty modeling a pair it pending pending the arrival of that was 21 model is so I do expect 12 extended it, particularly UK and Europe that was there any levers to be slightly higher than 6% in Q3, and Q4 will be a better measure for us right as we get those new programs that news crew.

Except that it's a good selling season for us quota for so it's that point in time, when I'd expect those levels to be at the lower end of 6% rather than the high end or maybe even into 7% for this quarter.

And as I've said to you for four or five quarters, 7% below is a good place for US 7% above is not such a good place. So we're looking to get back into that happy place of sub 7% and the second one for the year.

Sure. So the next question is on the potential you find something you have covered this questions and therefore, a chip that the next question is from our venture LMA City could you. Please shed some light on the provision for you you see auto fine, but it later be will it be I think the key point is will it be offset.

Late draw and also how do we stand with any competition.

Yeah. So the signs are actually assessed over a calendar year basis. So this is why this is a really big quarter for us because it's the last quarter in the calendar year. We do believe this will be a compliant quota and we're also hopeful it will actually be a quarter, where in credit and therefore the alternate.

Amenta of signs will be lower than the 90 million, we would hope at the backend of this year the actual payment pair for the fine in the pure assessment from externals will be into the second or third quarter next year. So we're hopeful nine says to us it's going to get and we do expect it to actually reduce.

It really depends on the timing of those perhaps coming through as mentioned earlier.

Thank you then moving on to the next question from again from Generics show in India BB, what does your aspiration of market coverage on a product portfolio perspective, and by when would be the <unk>, you'll be able to achieve it and what are the gaps that you would like to finish what you want to take that.

How about that.

So.

If we really see the next five years and you know the segments, you know which are going to really cool.

Coming on yours.

A little cheaper segment as you know one is the compact assumes all the other one is the mix agencies, including you know the sevenci there wasn't WSE I'm getting traction.

Oh in Hutchins it could be the premium had 15 C. you know booked.

And then there will be Oh boy, the mindful subcompact facilities on so it should be or even.

Even smaller than the compact assumes that we see today.

Well I think you know how that set us all the consumable business, how we had planned our product portfolio and so therefore that youve seen come back. This year, we have a mix on the GVT placed one.

I'd say the CVG household how do you.

I understand bundle, they say, but I didn't see the version is also getting a lot of traction there for the guy that does when considering the speeds photos.

And then we launch it but.

The premium had said MS. We have entered this year did you guys close.

And there is limited so listen we'd be coming that you know the agents who like the DC you know the automatic transmission.

No.

It goes in the future.

And all this.

So compared to see I think you know the one which we have already and also these SPX or Goldman Oregon, Oh. This is going to sits in this space. So you know our portfolio is pretty much aligned to boost segments, which are going to go into to them, but the launch of driver doesn't on them I think our portfolio will be complete.

Even sitting in a very sweet spot of where the market is going to equal funnels electrification going to be a little easier. The penetration is going to come this will be increasingly most of them.

And.

That's what our plan, we should have the latest portfolio levels.

Thank you the minutes, yeah, [laughter] sanction related point on Oh, PB coming from a a democrat or from it [laughter].

Because just the security.

Last quarter, we were despondent and this quarter, we have turned EBITDA breakeven our plans to find an investor partner now delayed.

Yeah, I wouldn't characterize last quarter of the despondent I thought he said, but do watch the space a lot of work is happening that we've had driven as a betrayal for putting it there are I don't think we're we're not a position on the investor or a partner.

Is long term and we did say that we need a partner on market is an imperative to date, the turnarounds businesses will be done by up with our own portfolio the Tokyo.

More about the opportunity for the model, which is what we are trying to capture with those particular, oh off getting a partner and combinations are underway and as and when something comes up people decide to share it with you.

So moving onto a ER visits are going on in from Emcare Global.

Let me this is on.

Over the medium term exceed these could reach a sizable portion of the volumes and the luxury segment.

Would you be confident that J Mac and other similar market share to make these segments.

Can you quantify or give some color on the capex R&D spend planned for either over the next two years and also the there's a bias on our lines of the companies exploring.

It did.

Thank you Pat a hit on for Doug would not be confident well I'll be confident that we will let the targets were intending to hit which will underpin the capital investments, we need to make I think I referenced earlier.

Our growth towards easy you know, we'll be a little slower than the competitors technology is changing significantly quickly as you know so you know we will put in place the technologies, we need at the point in time, we need to be compliant. We definitely will be compliant we want to be compliant way on happy that we were.

Speech in calendar year 20 lot of that has been taken out of our hands skew to the unfortunate events of course, we were intended to be compliant and see why 20, as well and we will be again and see why 21, I'm not going to break down investment spy Watsi. The watts BV what he has.

We will talk in more detail on the second of December a balanced strategy and we will share some of the technologies and we'll give you a lot more information about what we're planning to do over the next five to seven years at that point in time or something.

Thank you [laughter].

Second question from Oregon, and then again is.

On the target of becoming the increase can you indicate how important iverson beat to meet this target Alco. Please indicate between these are to be considered for sale.

As they said there are three verticals that we see in terms of using up that two and a new York Seattle automotive that to near zero number one will always be free cash flow. Because these are all patients met and these in short the mortgage.

Cash goals, we continue to get it.

Right to win in this market and therefore, we have to or not like to grow and winning market. Therefore free cash flow being positive is an imperative and that could be a very important and locks LIBOR LIBOR number one.

Can leave it wouldn't be divestments, and then up to non core and that's something all the iden Department of Tyler technologies and hockey Touchy.

We're also looking at parts of the business that Matt.

Core product earlier, but when we look at it it may not be the future core and therefore kind of something that we will take a hard look at and we have time to do that and that piece and lastly, once you have done. These two then what are what are the remaining is that it doesn't equity top that does eat I'd be looking at and at that point in time, that's why we see that.

Hi, Alton, but even more important the operating and free cash flows to the office.

Our next question from a I mean, crannies or see anything the emission chart for your none of which I like and in which quarter was a charge that importantly already talked about can you just try to find Atlantic I mean.

I think it goes into revenue and then its on the balance sheet to support to the legal in product liability reserves.

One of the level, we haven't EDI penetration you need to meet you need in order to meet say Mr. Hong Kong you going forward.

And I've been double digit percentage is low double digits or see why 21.

Okay.

And one of the level of water flexibility you have between you can you come back I think you've already covered this question.

Our next question is from Ah Truckers Union, but again, one of the capacity of the friend or that you have.

Well it depends on M&A suede, how many ships we pull on we're looking to pull up to 5000 units a month into the marketplace.

Okay.

Question from conferencing animal drug in Tata Motor Finance books, but more of a one of the connection efficiency as the latest Sabina them pick up we are now starting to cross the 92% Mark and a that'll September month and are probably expecting to that even further but.

But overall I think the I see all but our conviction than what we had a bad word about at least sometime in September or October.

I'm moving on to the next question I think other than from a financial my I'd be a capsule.

Now is the companies and looking for a strategic partner products Baby segment on how is the company planning to be debt free I think you're covered both of these in my in my comment.

And I think I'll walk from top mutual funds and so did thing or whatever.

In your assessment vendor that minutes PV industry like you did report Ross.

Hope we could that's a replacement demand for CB, Richard you want to take that.

Gives valley.

So.

Said a month over month.

This will be more news that we've grown and [noise].

Yeah.

Bruce who are the same ones to your husband Greene County.

Mmm.

Yes, we really not going.

And that would be good.

[laughter].

And looking into the vehicle might be.

You got it.

Mm Hmm.

Robby.

Well why why gross margin not so you're talking about that.

Please.

To begin this quarter to one.

Yes.

I think as they go to school.

Wait a few leases.

That's true Yeah, you see me.

We pretty well I think we keep on tracking how.

Do you need to get this let me just you can then.

Mhm building, they're going to be going ahead.

Well.

Yeah.

Great.

I have a next question from a bus or they buy energy ambit capital, but they're not inventory now under control would it be right to assume approximately 30, plus a brazen wholesale volume in third quarter.

On the larger resumption of flattery dan's quarter on quarter that's.

That's better operating leverage.

Going further.

Okay.

Ah yes. Thank you and thank you for the question. So yes dealer inventories on L. back why we wish them to be therefore going forward our levels of production and our level of wholesale and at retail is outside of sea JLR, excluding ctr excuse me should broadly consistent with.

Each other and yes, they will be higher than quarter, two and as a guide for quarter. Three you know 13.

30% increase quarter over quarter or thereabouts, physical guide actually maybe a bit more.

Okay. Thanks, and then next is from let's another axis mutual fund.

Two questions.

JLR EBITDA 41 million pounds, and Capex of 551 million Pops. So JLR has not generated any free cash flows it looks more working capital, which went higher and you want to talk to the western Gennadi. Your cash how much of that is working capital. There was some can happen would generate free cash flow.

Because ours is largely done I think we answered. This question in terms of the sequins Oh, we see the priorities. This quarter was important to get back the free cash flow of the lost because of working capital unwind. So we have done that.

Going forward. It will obviously be a mix of demand has been less of profitability improvement for us to drive or the free cash flow, but we are looking for.

Second we are seeing JLR, losing market share, especially in China do you think you're running a risky strategy of reducing capex, which looks like will be equal to or their position rather than working on more deals like the lunch converting free cash flow.

This again I think you do not cover that link things, we've been looking at health of a sale that you're doing up there in China, and the improving and driving the profitability.

I don't think I agreed to the point, saying that started using capex infecting market share in China today.

We are ensuring that we are having that can be ecosystem between us.

Our dealer as well as a an exciting range of product that is out there.

Don't forget that we launched a friend during the peak of a pandemic and three continuing to introduce our electrified portfolio and going to continue to have the top products that are coming into the market there.

So capex and its implications going forward and the portfolio I think it would be out at me a very good discussion that we can have on the second of December.

And we will talk about this in greater detail, but let me reassure you are that are not looking to become a zombie company.

Every quarter Capex or gender cash paid on but then after that we have no product to sell that off of Bancolombia back will not be acceptable enough to be quite a city strategy too.

So.

We don't have shrunk from.

Shops under somewhat a mutual fund.

On Jannati retail inventory, we see that inventory days are pretty covered lives.

Are you seeing the need for further de stocking and housekeeping question deposition and Jannati you kept panel has been lower quarter on quarter all.

All klondex.

Then castle Bromwich or operational can you confirm if I understand the deposition.

Hey, Jim.

Yeah. Okay. Thank you for the questions again, so I I. The average average plant level dealer inventories are absolutely why would wish that needs to be when we break that down by market and by name plate. There are still some nameplates in some markets with a bit which are higher some overseas markets in particular and will continue.

To take those down Conversely, there are also some a name plates in some pockets, which are too low and good examples of that would be rest within North America in quarter, two which is why I mentioned earlier North America retail Swift, partially a lower in the quarter year over year because.

Supply constraints, we expect all of those market by market nameplate issues to be resolved as we go through Q3 and into quota for yeah depreciation year over year lower yes. That's overwhelmingly is a result of the range Rover and.

The range Rover sport that is causing that almost eight years in life and therefore, the residual depreciation Dick I was much much lower than it was 12 months ago. Ultimately you know you know an 18 month time those cards will be replaced with all new fresh because that's partially as a result of cobiz and everything going on.

Back a little bit, but mostly speaking those cars is still significant in the market place selling really well generating a lot of money, but they just gone beyond the natural H, yeah cycle, and therefore, DNA that much left to write off.

Thanks, Andrew.

The next question is from antique limited we are under a what are they going doing to contain warranty costs increase as fourk on portrait of increased again.

Let's take that one as well.

Okay. Many thanks for the question so quarter on quarter, the increases where we spoke around the campaigns I referenced them I paid campaign and the reversal of the reversal last loss yeah of up he has a campaign in China I've also mentioned I think on.

At least two or three occasions, we can see the underlying data for AG 20 model year vehicles. It's actually are performing much better than 18, and 19 model. Yes, we have a accounting rules of the road, which only allow us to take effect of those 20 modeling I just.

Certain points in time, 75% of the cells need to be so into customer hands of a model yeah that will start to happen in quarter. Three so my expectation as you start to see warranty from quarter. Three this year below 4% don't forget just like I mentioned, 70% was a line of code.

So bad for B M, 84% is that line in warranty. So my expectation is we will be lower than that level in the 3% plus range in quarter. Three so that's why the warrant will start to come through as a positive in the second half of the year.

Yeah.

One question coming through which I will take we have seen the drawing of Jaguar XE from the U.S. can we see more success right in the heart attack or more Oh do all your questions or anything related to portfolio to December 2nd, but maybe a better time, Tom third comprehensively.

How long can we see planned capex capex going on related to the model the platform.

This again linked to industrial footprint and portfolio, let's pick it up in the on the December.

And next question is from JP Morgan Jim up at my Hope.

Oh can you please give us some indication on how increased electrification of an impact gross margin.

Second question, an updated view on how much excess inventories JLR will need to hold in case of a normally break that.

Hey, Jim.

Okay. Thank you for the question. So you know margins obviously it depends on how you measure the margin if you measure it before fines then there obviously is a reduction of the margin will make on electrified vehicle rather than a traditional ice. However, you know we put vehicles into the market.

Place for compliance purposes, and if we want to do that you know the losses, we make on those vehicles will be even higher so our complaint strategy. Our electrification strategy follows our value maximization strategy and it's the right thing to do also as well of course.

From an excess inventory level you know we again, we're on record previously we continue to raise our Pos inventories, particularly.

Just in case, there's friction a across the board. This over the first days and weeks of January we have done the same again over the last several weeks leading up to the end of this year. You know said we've added an extra days was a buffer inventory in stock which.

Is in place we can to hold inventory forever of course, and therefore, it will help us with days rather than weeks into January you know finished vehicle inventories. Similarly, we will grow it in between UK and Europe over this period of time just to avoid that level of friction.

Our expectation is all the time wall ever the challenge is out in the order that will be factored into working capital and to operational requirements over the following months I suspect we'll work through this during quarter four or slightly to be a big deal in the early part of quarter four but we'll work through it. So we are doing exactly what we've done in pre.

This quarters with built where we can be can hold inventory you know there's just so many parts come into an actress you can't hold enough to trade through the uncertain period.

Yep.

Thanks, a question girlish coming your way this is from Chicago like India.

Yeah minutes, maybe what's your understanding on the willingness of Fanapt shifts to fund new trucks.

Especially I mean at Seabee.

Oh, the resale value of trucks and risk of default for Threed profession.

I'll spend or the moratorium period.

And then the next question has to be so supertex.

These two.

[laughter].

Okay. Thanks, Doug.

I think we have seen a gradually from Q1 and into Q2 that those dimensions have reduced the convergent and I think that's coming forward and funding.

Not only the notch customers, but also the retail customers, even the loan to value issues have been employing as we move from one of the few too. So I think there was a.

Good.

When this and no lead which is now available for diminished city customers.

On your second question regarding.

Oh, you know what is the status of the moratorium too I think would have been better answered by Mike's ILEC some back but as they move from him I think this is also being managed very well as.

As we move from what are the ones, who want to get into and from what we're going to do a structured loans, so to say and I see we don't see too many abuse deterrent happening as we go ahead in the administration not only municipal unionized domain. So that's how I see the financing environment. There has been a baby boomers as you move.

Must gorman from you all of you who at least I know Mike.

<unk>.

Yeah. Thanks, Chris I think a bunch of time, a I think we have it on time or once again for the rest of the question that I wrote that duty telcos, Bill Tryon or meet with you in any case at the time, we can answer these questions. Once again, thanks, a lot for your time and patient than going to the.

Questions and listening to us Oh, I look forward to seeing you know again in the coming days and thanks to the team on the call as well or responses much appreciated. Although if you stay there and catch you soon and look forward to seeing you on December 1st on December 2nd in the two Investor day. Thank you.

On behalf of Tata Motors Gimoti.

That concludes this country. Thank you for joining us and you may now disconnect your line.