Q1 2027 Tata Motors Ltd Earnings Call

August 12, 2026

Speaker #1: Begin with the financial highlights for the quarter. Before we go into the numbers, a quick word on Safe Harbor. Consistent with our last quarter presentation, our primary numbers represent the standalone financials, which include joint operations with TATA Cummins.

[Company Representative] (Motilal Oswal Financial Services): Begin with the financial highlights for the quarter. Before we go into the numbers, a quick word on safe harbor. Consistent with our last quarter presentation, our primary numbers represent the standalone financials, includes joint operations with Tata Cummins. Consolidated results follow later in the deck. One change to note this quarter, Freight Tiger is now included as a subsidiary following the increase in our stake in May 2026. With that, let me take you through the highlights for the quarter. Q1 was a quarter of execution on the commitments we made at the start of the year. Few highlights that deserve a mention. On electric vehicles, we have strengthened our electric CV leadership with over 3,400 electric vehicle orders across segments, building on the momentum we saw in the second half of last year.

Sneha Gavankar: We will begin with the financial highlights for the quarter. Before we go into the numbers, a quick word on safe harbor. Consistent with our last quarter presentation, our primary numbers represent the standalone financials, includes joint operations with Tata Cummins. Consolidated results follow later in the deck. One change to note this quarter, Freight Tiger is now included as a subsidiary following the increase in our stake in May 2026. With that, let me take you through the highlights for the quarter. Q1 was a quarter of execution on the commitments we made at the start of the year. Few highlights that deserve a mention. On electric vehicles, we have strengthened our electric CV leadership with over 3,400 electric vehicle orders across segments, building on the momentum we saw in the second half of last year.

Speaker #1: Consolidated results follow later in the deck. Unchanged to note this quarter, freight tiger is now included as a subsidiary following the increase in uptake in May 2026.

Speaker #1: That let me take you through the highlights for the quarter. Q1 was a quarter of execution on the commitments we made at the start of the year.

Speaker #1: A few highlights that deserve mention: on electric vehicles, we strengthened our electric CV leadership with over 3,400 electric vehicle orders across segments, building on the momentum we saw in the second half of last year.

Speaker #1: On the SCV pickup front, we launched the Ace Gold Plus XL, Ultra V40, and Intra EV, broadening the SCV PU portfolio across ICE, CNG, and electric.

[Company Representative] (Motilal Oswal Financial Services): On the SCV pickup front, we launched the Ace Gold+ XL, Intra V40, and Intra EV, broadening the SCV PU portfolio across ICE, CNG, and electric. For the Indonesia order of 70,000 units of Yodha and Ultra T.7, we initiated deliveries during the quarter. We also crossed a major milestone with our Lucknow plant crossing 10 lakh commercial vehicles in cumulative production. We also partnered with Hindustan Petroleum Corporation Limited on a scalable circular economy model for used automotive lubricants. The Tata Motors Foundation's Integrated Village Development Program has now reached close to 200 villages nationwide. Next slide, please. There were two significant corporate actions in the quarter. On the Iveco transaction, regulatory approvals are now in the final stage with only one approval pending. All information requests have been addressed, and we expect a final clearance by the end of August 2026.

Sneha Gavankar: On the SCV pickup front, we launched the Ace Gold+ XL, Intra V40, and Intra EV, broadening the SCV PU portfolio across ICE, CNG, and electric. For the Indonesia order of 70,000 units of Yodha and Ultra T.7, we initiated deliveries during the quarter. We also crossed a major milestone with our Lucknow plant crossing 10 lakh commercial vehicles in cumulative production. We also partnered with Hindustan Petroleum Corporation Limited on a scalable circular economy model for used automotive lubricants. The Tata Motors Foundation's Integrated Village Development Program has now reached close to 200 villages nationwide. Next slide, please. There were two significant corporate actions in the quarter. On the Iveco transaction, regulatory approvals are now in the final stage with only one approval pending. All information requests have been addressed, and we expect a final clearance by the end of August 2026.

Speaker #1: For the Indonesia order of 70,000 units of Yodha and Ultra T7, we initiated deliveries during the quarter. We also crossed a major milestone with our Lucknow plant crossing 1 million commercial vehicles in cumulative production.

Speaker #1: We also partnered with HPCL on a scalable circular economy model for used automotive lubricants, and the Tata Motors Foundation's integrated village development program has now reached close to 200 villages nationwide.

Speaker #1: Next slide, please. There were two significant corporate actions in the quarter. On the Iveco transaction, regulatory approvals are now in the final stage, with only one approval pending.

Speaker #1: All information requests have been addressed, and we expect a final clearance by the end of August 2026. On that basis, the tender offer is expected to be launched in early September 2026, with closure expected by early November 2026.

[Company Representative] (Motilal Oswal Financial Services): On that basis, the tender offer is expected to be launched in early September 2026, with closure expected by early November 2026. On Freight Tiger, we acquired an additional 18.1% equity stake in May 2026 for around INR 96 crores, taking our total holding to approximately 63.6%. Freight Tiger is now a subsidiary. The intent here is straightforward. We are bringing FleetEdge and Freight Tiger together so that it gives us an end-to-end digital ecosystem across the logistics value chain, covering both the truck ecosystem and the trip ecosystem. The next few slides cover the standalone business, which includes JO with Tata Cummins. Let me start with the volumes. Q1 wholesales were approximately 108,700 units, up 26% YOY. A robust quarter and one delivered through a period of heightened geopolitical tensions.

Sneha Gavankar: On that basis, the tender offer is expected to be launched in early September 2026, with closure expected by early November 2026. On Freight Tiger, we acquired an additional 18.1% equity stake in May 2026 for around INR 96 crores, taking our total holding to approximately 63.6%. Freight Tiger is now a subsidiary. The intent here is straightforward. We are bringing FleetEdge and Freight Tiger together so that it gives us an end-to-end digital ecosystem across the logistics value chain, covering both the truck ecosystem and the trip ecosystem. The next few slides cover the standalone business, which includes JO with Tata Cummins. Let me start with the volumes. Q1 wholesales were approximately 108,700 units, up 26% year-on-year. A robust quarter and one delivered through a period of heightened geopolitical tensions.

Speaker #1: On freight tiger, we acquired an additional 18.1% equity stake in May 2026 for around 96 crores, taking our total holding to approximately 63.6%. Freight tiger is now a subsidiary.

Speaker #1: And the intent here is straightforward: we are bringing fleet edge and freight tiger together so that it gives us an end-to-end digital ecosystem across the logistics value chain, covering both the truck ecosystem and the trip ecosystem.

Speaker #1: The next few slides cover the standalone business, which includes JO with Tata Cummins. Let me start with the volumes. Q1 wholesales were approximately 1,080,700 units, up 26% year on year.

Speaker #1: A robust quarter and one delivered through a period of heightened geopolitical tensions. It's important to note that this growth was broad-based across every product line, and each in double digits.

[Company Representative] (Motilal Oswal Financial Services): It is important to note that this growth was broad-based across every product line and each in double digits. SCV at 26.4K units, up 22%, ILMCV at 17.1K units, up 16%, SCV pickup at 38.3K units, up 35%, Commercial Vehicle passenger at 18.7K units, up 23%, and exports at 8.1K units, up 35%. This slide summarizes the standalone financials. The volume momentum we saw in the last page translated into a 23% revenue growth for the quarter. It stood at INR 19,300 crores. EBITDA was INR 2,300 crores at a margin of 11.7%, down 60 bps YOY. This moderation is mainly commodity-led, and I will take you through the walk on the next slide. EBIT margin was 9.4%, down only 20 bps, and PBT before exceptional items was INR 2,100 crores, up 26% YOY. So despite the margin moderation, absolute profit growth has kept pace with revenue.

Sneha Gavankar: It is important to note that this growth was broad-based across every product line and each in double digits. SCV at 26.4K units, up 22%, ILMCV at 17.1K units, up 16%, SCV pickup at 38.3K units, up 35%, Commercial Vehicle passenger at 18.7K units, up 23%, and exports at 8.1K units, up 35%. This slide summarizes the standalone financials. The volume momentum we saw in the last page translated into a 23% revenue growth for the quarter. It stood at INR 19,300 crores. EBITDA was INR 2,300 crores at a margin of 11.7%, down 60 bps YOY. This moderation is mainly commodity-led, and I will take you through the walk on the next slide. EBIT margin was 9.4%, down only 20 bps, and PBT before exceptional items was INR 2,100 crores, up 26% YOY. So despite the margin moderation, absolute profit growth has kept pace with revenue.

Speaker #1: HCV at 26.4k units, up 22%. ILMCV at 17.1k units, up 16%. SCV pickup at 38.3k units, up 35%. CV passenger at 18.7k units, up 23%.

Speaker #1: And exports at 8.1k units, up 35%. This slide summarizes the standalone financials. The volume momentum we saw in the last page translated into a 23% revenue growth for the quarter.

Speaker #1: We stood at 19,300 crore. EBITDA was rupees 2,300 crore. At a margin of 11.7%, down 60 basis point 5y. This moderation is mainly commodity-led, and I will take you through the walk on the next slide.

Speaker #1: EBIT margin was 9.4%, down only 20 basis points. And PBT before exceptional items was rupees 2,100 crore, up 26% YOY. So despite the margin moderation, absolute profit growth has kept pace with revenue.

Speaker #1: Free cash flow was rupees 1,100 crore against a negative 1,800 crore in Q1 last year. That's a swing of almost 2,900 crores. I will also cover the drivers for that shortly.

[Company Representative] (Motilal Oswal Financial Services): Free cash flow was INR 1,100 crore against a negative INR 1,800 crore in Q1 last year. That's a swing of almost INR 2,900 crore. I will also cover the drivers for that shortly. Net cash stood at INR 7,100 crore as of 30 June, against INR 7,500 crore at March end, and this is after the INR 1,473 crore dividend payout during the quarter. RoCE continued to be strong at 68% on a trailing 12-month basis, against 72% for FY26. Investment spending, INR 500 crore for the quarter was in line with plan. This is the walk from PBT before exceptional items of INR 1,635 crore in Q1 of FY26 to INR 2,057 crore in Q1 of FY27. What you see below that is the EBIT margin bridge. Volume and mix contributed to INR 636 crore and realization was a further INR 402 crore.

Sneha Gavankar: Free cash flow was INR 1,100 crore against a negative INR 1,800 crore in Q1 last year. That's a swing of almost INR 2,900 crore. I will also cover the drivers for that shortly. Net cash stood at INR 7,100 crore as of 30 June, against INR 7,500 crore at March end, and this is after the INR 1,473 crore dividend payout during the quarter. RoCE continued to be strong at 68% on a trailing 12-month basis, against 72% for FY26. Investment spending, INR 500 crore for the quarter was in line with plan. This is the walk from PBT before exceptional items of INR 1,635 crore in Q1 of FY26 to INR 2,057 crore in Q1 of FY27. What you see below that is the EBIT margin bridge. Volume and mix contributed to INR 636 crore and realization was a further INR 402 crore.

Speaker #1: Net cash stood at ₹7,100 crore as of June 30, against ₹7,500 crore at March end. And this is after the ₹1,473 crore dividend payout during the quarter.

Speaker #1: Auto Rusi continued to be strong at 68% on a trailing 12-month basis, against 72% for FY26. Investment spending: rupees 500 crore for the quarter was in line with plan.

Speaker #1: So this is the walk from PBT before exceptional items of rupees 1,635 crore in Q1 of FY26 to rupees 2,057 crore in Q1 of FY27.

Speaker #1: And what you see below that is the EBIT margin bridge. Volume and mix contributed to rupees 686 crore and realization was a further 402 crore.

Speaker #1: The price increases that we took during the quarter have largely been passed through. And together, these added 140 basis points to EBIT margin. Variable costs were the principal headwind at 649 crore, or 340 basis points.

[Company Representative] (Motilal Oswal Financial Services): The price increases that we took during the quarter have largely been passed through, and together these added 140 basis points to EBIT margin. Variable costs were the principal headwind at INR 649 crore or 340 basis points. This is primarily commodity inflation, steel, aluminum, and copper all flowing through into material cost, consistent with the headwinds that we flagged when we closed FY26. Other fixed costs contributed positively at 180 basis points. This is operating leverage on a larger revenue base. FX and other items were neutral to margin. Net of all this, EBIT margin moved from 9.6% to 9.4%. In summary, operating leverage and improved realizations have absorbed almost all of the significant commodity headwind.

Sneha Gavankar: The price increases that we took during the quarter have largely been passed through, and together these added 140 basis points to EBIT margin. Variable costs were the principal headwind at INR 649 crore or 340 basis points. This is primarily commodity inflation, steel, aluminum, and copper all flowing through into material cost, consistent with the headwinds that we flagged when we closed FY26. Other fixed costs contributed positively at 180 basis points. This is operating leverage on a larger revenue base. FX and other items were neutral to margin. Net of all this, EBIT margin moved from 9.6% to 9.4%. In summary, operating leverage and improved realizations have absorbed almost all of the significant commodity headwind.

Speaker #1: This is primarily commodity inflation, steel, aluminum, and copper, all flowing through into material cost. Consistent with the headwinds that we flagged when we closed FY26.

Speaker #1: Other fixed costs contributed positively at 180 basis points. This is operating leverage on a larger revenue base. FX and other items were neutral to margin.

Speaker #1: Net of all this, EBIT margin moved from 9.6% to 9.4%. And in summary, operating leverage and improved realization have absorbed almost all of the significant commodity headwind.

Speaker #1: Coming to free cash flow for the quarter, FCF was rupees 1,114 crore, against a negative of rupees 1,796 crore in Q1 of FY26. A swing of about 2,900 crore rupees.

[Company Representative] (Motilal Oswal Financial Services): Coming to free cash flow for the quarter, FCF was INR 1,114 crore, against a negative of INR 1,796 crore in Q1 of FY26, a swing of about INR 2,900 crore. Going through the walk, PBT before exceptional items of INR 2,057 crore. Non-cash items were INR 247 crore. On tax, the INR 500 crore outflow compares with just INR 20 crore in Q1 of last year. As flagged during the full-year results, cash tax is now a recurring item for us. With that, we arrive at a cash CAC of around INR 1,800 crore. CapEx, roughly about INR 554 crore, lower than the INR 639 crore in Q1 of last year, but in line with our investment plan.

Sneha Gavankar: Coming to free cash flow for the quarter, FCF was INR 1,114 crore, against a negative of INR 1,796 crore in Q1 of FY26, a swing of about INR 2,900 crore. Going through the walk, PBT before exceptional items of INR 2,057 crore. Non-cash items were INR 247 crore. On tax, the INR 500 crore outflow compares with just INR 20 crore in Q1 of last year. As flagged during the full-year results, cash tax is now a recurring item for us. With that, we arrive at a cash CAC of around INR 1,800 crore. CapEx, roughly about INR 554 crore, lower than the INR 639 crore in Q1 of last year, but in line with our investment plan.

Speaker #1: Going through the walk, PBT before exceptional items of rupees 2,057 crore non-cash items were 247 crore. On tax, the rupees 500 crore outflow compares with just rupees 20 crore in Q1 of last year.

Speaker #1: As flagged during the full-year results, cash tax is now a recurring item for us. With that, we arrive at a cash pack of around rupees 1,800 crore.

Speaker #1: Capex roughly about 554 crore, lower than the 639 crore in Q1 of last year, but in line with our investment plan. But the decisive difference year on year is efficient working capital.

Speaker #1: This quarter consumed only rupees 232 crore as against 3,474 crore in Q1 of FY26. Next slide. Total investment spending in Q1 was 515 crore.

[Company Representative] (Motilal Oswal Financial Services): The decisive difference year-on-year is efficient working capital. This quarter consumed only INR 232 crore as against INR 3,474 crore in Q1 of FY26. Next slide. Total investment spending in Q1 was INR 515 crore. At approximately 2.7% of revenue, this sits comfortably within our guided range of 2% to 4%. This completes the standalone numbers. Now let me turn to the consolidated results. Consolidated revenue for Q1 was INR 20,700 crore, up 19% YOY. EBITDA was INR 2,300 crore at 10.9%, down 90 basis points, and EBIT was 8.5%, down 80 basis points. This was due to the same commodity dynamic that we discussed at the standalone level.

Sneha Gavankar: The decisive difference year-on-year is efficient working capital. This quarter consumed only INR 232 crore as against INR 3,474 crore in Q1 of FY26. Next slide. Total investment spending in Q1 was INR 515 crore. At approximately 2.7% of revenue, this sits comfortably within our guided range of 2% to 4%. This completes the standalone numbers. Now let me turn to the consolidated results. Consolidated revenue for Q1 was INR 20,700 crore, up 19% YOY. EBITDA was INR 2,300 crore at 10.9%, down 90 basis points, and EBIT was 8.5%, down 80 basis points. This was due to the same commodity dynamic that we discussed at the standalone level.

Speaker #1: At approximately 2.7% of revenue, this sits comfortably now at 2%. This completes the standalone numbers. Now let me turn to the consolidated results. Consolidated revenue for Q1 was rupees 20,700 crores, up 19% YOY.

Speaker #1: EBITDA was rupees 2,300 crore, at 10.9%, down 90 basis points. And EBIT was 8.5%, down 80 basis points. This was due to the same commodity dynamic that we discussed at the standalone level.

Speaker #1: PBT before exceptional items was rupees 3,000 crore, up 81%. This includes a mark-to-market adjustment on our investments in TATA Capital. Consolidated free cash flow was rupees 400 crore, against a negative of 2,000 crore in Q1 of FY26.

[Company Representative] (Motilal Oswal Financial Services): PBT before exceptional items was INR 3,000 crore, up 81%. This includes a mark-to-market adjustment on our investments in Tata Capital. Consolidated free cash flow was INR 400 crore against a negative of INR 2,000 crore in Q1 of FY26. Net cash stood at INR 13,500 crore as on 30 June, as against INR 13,700 crore at March end, maintaining a strong liquidity position through the quarter. With that, let me hand over to Girish to take you through the business updates. Over to you, sir.

Sneha Gavankar: PBT before exceptional items was INR 3,000 crore, up 81%. This includes a mark-to-market adjustment on our investments in Tata Capital. Consolidated free cash flow was INR 400 crore against a negative of INR 2,000 crore in Q1 of FY26. Net cash stood at INR 13,500 crore as on 30 June, as against INR 13,700 crore at March end, maintaining a strong liquidity position through the quarter. With that, let me hand over to Girish to take you through the business updates. Over to you, sir.

Speaker #1: And net cash stood at 13,500 crore as on June 30, as against 13,700 crore at March end, maintaining a strong liquidity position through the quarter.

Speaker #1: With that, let me hand over to Ginesh to take you through the business updates. Over to you.

Speaker #2: Thank you, Sneha. So let me begin with the Vahan share. The registration share. So we saw 100 bips improvement in the Vahan share. On a sequential basis, and as compared to FY26, there was a growth of 170 bips.

Girish Wagh: Thank you, Sneha. Let me begin with the Vahan share, the registration share. We saw a 100 bps improvement in the Vahan share on a sequential basis. As compared to FY26, there was a growth of 170 bps. We further strengthened the position in heavy commercial vehicles to 56.3. ILMCV saw a slight drop essentially due to the supply chain challenges that we have seen, especially in the Western zone. We also had a 110 bps growth in Vahan share in small commercial vehicles and around 490 bps growth in CV passenger, which is buses and vans. This is on the back of the tenders that we had won. Moving on.

Speaker #2: We further strengthened the position in heavy commercial vehicles. 256.3. Aisle MCV saw a slight drop, essentially due to the supply chain challenges that we have seen, especially in the western zone.

Speaker #2: And we also had 110 bps growth in Vahan share in small commercial vehicles, and around 490 bps growth in CV passenger, which is buses and vans.

Speaker #2: So this is on the back of the tenders that we had won. Moving on, as far as fleet utilization is concerned, this is our data from the fleetage that we have deployed now almost on 1.2 million vehicles.

Girish Wagh: As far as fleet utilization is concerned, this is our data from the FleetEdge that we have deployed now, almost on 1.2 million vehicles. The fleet utilization improved month-over-month in Q1. It improved from April to May to June. But the Q1 fleet utilization remained slightly below that of Q1 of last year. This is also on the back of a very high volume which was sold in H2 of last year. It is just slightly below that of Q1 of last year and not a concern at this juncture. What remains healthy is the significant growth in e-way bills as well as diesel consumption, which shows the continuous growth in utilization of the vehicles and the freight which is available for transportation. Moving on.

Speaker #2: So the fleet utilization improved month over month in Q1. So it improved from April to May, May to June. But the Q1 fleet utilization removed remained slightly below that of Q1 of last year.

Speaker #2: But this is also on the back of a very high volume, which was sold in H2 of last year. So it is just slightly below that of Q1 of last year and not about not a concern at this juncture.

Speaker #2: But what remains healthy is the significant growth in e-way bills as well as diesel consumption. It shows the continuous growth in utilization of the vehicles and the freight, which is available for transportations.

Speaker #2: Moving on, so the industry saw a healthy momentum with the wholesale volume growing almost 18% on a YOY basis. And our volumes grew by around 26% in the same period.

Girish Wagh: The industry saw healthy momentum with the wholesale volume growing almost 18% on a YOY basis, and our volumes grew by around 26% in the same period. As I spoke on the earlier slide, e-way bill generation shows a very good growth of 12.4%, which does indicate healthy freight available for transportation. Fleet utilizations improved month-over-month, although Q1 FY27 is slightly below that of Q1 FY26. Diesel consumption also grew to overall positive markers for the industry. Our businesses, starting with trucks, we have a YOY market share gain due to volume growth, especially in heavy commercial vehicles on the back of the new product launches that we spoke earlier.

Speaker #2: As I spoke on the earlier slide, e-way bill generation shows a very good growth of 12.4%, which does indicate a healthy freight available for transportation.

Speaker #2: Fleet utilizations improved month over month, although Q1 FY27 is slightly below that of Q1 FY26. And diesel consumption also grew overall positive positive markers for the industry.

Speaker #2: Our businesses starting with trucks we have a YOY market share gain due to volume growth, especially in heavy commercial vehicles on the back of the new product launches that we spoke earlier.

Speaker #2: In buses and vans, the healthy market share growth driven by not just higher retails in all segments, but also delivery on the government tenders that we had won in the previous quarters.

Girish Wagh: In buses and vans, healthy market share growth driven by not just higher retails in all segments, but also delivery on the government tenders that we had won in the previous quarters. During the quarter gone by, we also won orders for 562 units across multiple segments. In small commercial vehicle, we did launch new products, which were spoken in the first few slides. In addition to that, the ramp-up in our Ace Diesel LNT and Ace Pro EV are supporting the volume growth. Intra brand continues to do well, and Intra EV has also been launched and has started doing well. Of course, currently, we do have some supply chain challenges, especially on Intra EV. The parts and services business continued to grow in double digits, strong growth trajectory.

Speaker #2: During the quarter gone by, we also won orders for 562 units across multiple segments. In small commercial vehicles, we did launch new products, which were spoken about in the first few slides.

Speaker #2: And in addition to that, the ramp-up in our ACE diesel LNT and ACE Pro EV are supporting the volume growth. Intra brand continues to do well, and Intra EV has also built launch.

Speaker #2: And has started doing well. Of course, currently we do have some supply chain challenges, especially on Intra EV. The parts and services business continued to grow in double digits, strong growth trajectory.

Speaker #2: And I think we were able to maintain uninterrupted diesel exhaust fluid supplies despite the crisis that we had in terms of availability of technical-grade urea due to the Middle East crisis.

Girish Wagh: I think we were able to maintain uninterrupted diesel exhaust fluid supplies despite the crisis that we had in terms of availability of technical-grade urea due to the Middle East crisis. This also led to, therefore, increase in the volume and revenue from the DEF supplies in Q1. Etech now installed base grew to more than 1 million vehicles, and the subscription renewal performance has improved dramatically on a YoY basis. In the international business, we initiated deliveries against the Indonesia order, and we had around 2,000 vehicles being shipped in Q1. Post that, we have been ramping it up consistently, and we have been able to demonstrate a 35% YoY growth despite very few numbers being shipped to Middle East.

Speaker #2: And this also led to, therefore, increase in the volume and revenue from the DEF supplies in Q1. ETH now installed base grew to more than a million vehicles.

Speaker #2: And the subscription renewal performance has improved dramatically on a YOY basis. In the international business, we initiated deliveries against the Indonesia order and we had around 2,000 vehicles being shipped in Q1 and post that, we have been ramping it up consistently.

Speaker #2: And we have been able to demonstrate a 35% YOY growth despite very few numbers being shipped to Middle East. On sustainability, and the EV business, with the launch of Intra EV and also the 55-ton EV tractor and the increase in diesel prices, which happened in middle of the last quarter, we have seen the TCO parity of EV with respect to diesel and the gas vehicles is being reached earlier and therefore they are becoming more attractive.

Girish Wagh: On sustainability and the EV business, with the launch of Intra EV and also the 55 ton EV tractor, and the increase in diesel prices which happened in middle of the last quarter, we have seen the TCO parity of EV with respect to diesel and the gas vehicles is being reached earlier, and therefore they are becoming more attractive. As a result, the EV volumes grew almost three times on a YoY basis. In fact, in SCV pickup, the EV penetration reached double digit in the months of both May and June, and that continues to improve further as we get into Q2. Therefore, we had more than 3,200 retails on SCV EVs in Q1, which alone is almost four times growth on a YoY basis.

Speaker #2: And as a result, the EV volumes grew almost three times on a YOY basis. And in fact, in SCV pickup, the EV penetration reached double digit in the months of both May and June and that continues to improve further as we get into Q2.

Speaker #2: Therefore, we had more than 3,200 retails on SCV EVs in Q1, which alone is almost four times growth on a YOY basis. On EV trucks, both I mean, heavy commercial vehicle tractors and tippers, there is a very strong interest from the customer robust engagement and the customers are looking forward for these kind of decarbonizing solutions.

Girish Wagh: On EV trucks, both, I mean, the heavy commercial vehicle tractors and tippers, there is a very strong interest from the customer, robust engagement, and the customers are looking forward for these kind of decarbonizing solutions. We also now have around more than 850 electric buses orders. This is a combination of orders from private customers as well as a few tenders that we won. Tenders from Chennai, Ahmedabad, Hyderabad, and the state of Odisha. Our smart city business, which operates electric buses, has now covered more than 59 crore kilometers and maintains the spotless performance in terms of uptime and safety. Moving on. As we look ahead for Q2, for the overall business, I think two things we have to manage actively.

Speaker #2: We also now have around more than 850 electric buses orders this is a combination of orders from private customers as well as a few tenders that we won.

Speaker #2: Tenders from Chennai, Ahmedabad, Hyderabad, and the state of Orissa. Our smart city business, which operates electric buses, has now covered more than 59 crore kilometers and maintains the spotless performance in terms of uptime and safety.

Speaker #2: Moving on, as we look ahead for Q2, for the overall business, I think two things we have to manage actively. First is the commodity inflation, which continues to be there, which will be managed through, of course, first line of attack is cost management.

Girish Wagh: First is the commodity inflation, which continues to be there, which will be managed through, of course, first line of attack is cost management, but we have also taken a price increase on 1 July. In addition to that, we have also seen some supply chain challenges, especially due to increase in demand in almost all the auto segments, be it two-wheeler, three-wheeler, four-wheeler, commercial vehicles, tractors. I think we have seen healthy growth all across. As a result of which some part categories like sheet metal, casting, forgings have become a constraint. To address this, a lot of debottlenecking actions have been taken place, few more in the pipeline, but this has already enabled us to improve the throughput towards the end of Q1 and, of course, in Q2.

Speaker #2: But we also taken a price increase on 1st of July and in addition to that, we also seen some supply chain challenges especially due to increase in demand in almost all the auto segments, be it two-wheeler, three-wheeler, four-wheeler, commercial vehicles, tractors.

Speaker #2: I think we have seen healthy growth all across, as a result of which the part categories like sheet metal, casting, and forging have become a constraint.

Speaker #2: To address this, a lot of de-bottlenecking actions have been taken place to more in the pipeline. But this has already enabled us to improve the throughput towards the end of Q1.

Speaker #2: And of course, in Q2. On the demand generation side, trucks we will come to accelerate the growth to the new MY 26 portfolio. The higher payload trucks and of course with heightened interest in the battery electric vehicles.

Girish Wagh: On the demand generation side, trucks, we will look to accelerate the growth through the new MY26 portfolio, the higher payload trucks, and of course, with heightened interest in the battery electric vehicles. EV passenger, we still have around 4,500 government orders on hand, which we will continue to deliver during this quarter. As I spoke, there are 850 e-buses orders also on hand. In small commercial vehicle, we will build on the demand which is being seen for both the Ace and Intra brand families, and also build on the shift which is happening towards EVs, and build on the market share gain. In parts and services, we continue to bring in innovative offerings, especially on services, which leads to improved demand not only for the products but also for the parts.

Speaker #2: EV passenger, we still have around four and a half thousand government orders on hand, which we will continue to deliver during this quarter. And as I spoke, there are 850 e-buses orders also on hand.

Speaker #2: In small commercial vehicles, we will build on the demand which is being seen for both the Ace and Intra brand families, and also build on the shift which is happening towards EVs.

Speaker #2: And build on the market share gain. In parts and services, we continue to bring in innovative offerings, especially on services. Which leads to improved demand not only for the products but also for the parts.

Speaker #2: We are also taking quite a few actions on supply chain some de-bottlenecking and also the fulfillment chain which will improve our delivery of customers.

Girish Wagh: We are also taking quite a few actions on supply chain, some debottlenecking, and also the fulfillment chain, which will improve our delivery to customers. On international business, we will continue to leverage increased demand from non-Middle East markets, especially in SAARC, sub-Saharan Africa, and also increase the throughput towards Indonesia. So that is the plan for the quarter ahead or the quarter that we are already into. Now, over to you for the questions.

Speaker #2: On international business, we will continue to leverage the increased demand from non-Middle East markets, especially in SARC and Sub-Saharan Africa. We also aim to increase the throughput towards Indonesia.

Speaker #2: So that's the plan for the quarter ahead, or the quarter that we are already into. Now, over to you for the questions.

Speaker #1: Thank you. We have a few questions which have come in already in the group. The first one is from Raghu. Congratulations, Raghu. From Novama, for the full year, do you expect double-digit growth in domestic CVs?

[Company Representative] (Motilal Oswal Financial Services): Thank you. We have a few questions which have come in already in the group. The first one is from Raghavan. Congratulations, Raghavan from Nuvama. For full year, do you expect double-digit growth in domestic CVs? Second question on exports, how do you see the full year outlook for Indonesia order, how do you see dispatches in FY27 and FY28?

Sneha Gavankar: Thank you. We have a few questions which have come in already in the group. The first one is from Raghavan. Congratulations, Raghavan from Nuvama. For full year, do you expect double-digit growth in domestic CVs? Second question on exports, how do you see the full year outlook for Indonesia order, how do you see dispatches in FY27 and FY28?

Speaker #1: And second question on exports: how do you see the full-year outlook for Indonesia order? How do you see dispatches in FY27 and 28?

Speaker #2: So thank you, Raghu. I think very early to talk about H2. It appears that Q2 will also see a healthy double digit YOI growth.

Girish Wagh: Thank you, Raghavan. I think very early to talk about H2. It appears that Q2 will also see a healthy double-digit YOY growth. I think it will be very interesting to see how the market pans out from September onwards, especially when we do a YOY comparison. Because last year, as you recollect, post the GST rate correction, the market really picked up from the month of September. But I think the kind of growth that we have seen in July, it will probably be safe to say that Q2 will end up with a double-digit growth. Now, coming to Indonesia, I think we are ramping up the supplies quite significantly. And yes, I can only say that the 70,000 orders will certainly be supplied over a period of 2 years, FY27 and FY28. Kapil?

Speaker #2: I think it will be very interesting to see how the market pans out from September onwards, especially when we do a YOI comparison. Because last year, as you recollect, post the GST rate correction, the market really picked up from the month of September.

Speaker #2: But I think the kind of growth that we have seen in July, it will probably be safe to say that Q2 will end up with double-digit growth.

Speaker #2: Now, coming to Indonesia, I think we are ramping up the supplies quite significantly. And yes, I can only say that the 70,000 orders will certainly be supplied over a period of two years, FY27 and FY28.

Speaker #1: Yeah. So next question from Kapil. So Kapil is also asking about demand outlook, which I think you just addressed. On EVs, what is the EV demand outlook?

[Company Representative] (Motilal Oswal Financial Services): Yeah. Next question from Kapil. So Kapil is also asking about demand outlook, which I think you just addressed. On EVs, what is the EV demand outlook? How is the response been to Intra EV, and what is our capacity? Costs, is there more cost pressure ahead, and will the price hike in Q2 cover it?

Sneha Gavankar: Yeah. Next question from Kapil. So Kapil is also asking about demand outlook, which I think you just addressed. On EVs, what is the EV demand outlook? How is the response been to Intra EV, and what is our capacity? Costs, is there more cost pressure ahead, and will the price hike in Q2 cover it?

Speaker #1: How has the response been to Intra EV, and what is our capacity? Regarding costs, is there more cost pressure ahead, and will the price hike in Q2 cover it?

Speaker #2: Yeah, I can see and again, Indonesia order is something which we've already answered. So maybe you can take these two. So I think on EV, as I said, Kapil first of all, thank you.

Girish Wagh: Yeah, I can see.

[Company Representative] (Motilal Oswal Financial Services): Yeah. And again, Indonesia order is something which we have already answered. So maybe you can take these two.

Sneha Gavankar: Yeah. And again, Indonesia order is something which we have already answered. So maybe you can take these two.

Speaker #2: On EV, yes, the demand outlook is quite positive. I already gave you the number of orders that we have for the electric buses. In addition to that, I think as a part of PM eBus Sewa, there are a few more new tenders that are quite positive as well.

Girish Wagh: So I think on EV, as I said, Kapil, first of all, thank you. On EV, yes, the demand outlook is quite positive. I already gave you the number of orders that we have for the electric buses. In addition to that, I think as a part of PM-eBus Sewa, there are a few more newer tenders which are also on the way. So we are quite positive on that. SCV pickup, which is completely in the retail market, is in fact doing very well. As I said, the TCO parity of Intra Ace Pro has become very attractive with respect to or in comparison to their ICE brothers. Therefore, from that perspective, I think the demand will remain strong and will continue to grow. In terms of capacity of Intra EV, actually, our in-house capacity is not a challenge at all.

Speaker #2: If you pick up, which is completely in retail market, is in fact doing very well. And as I said, the TCO parity of Intra Ace Pro has become very attractive with respect to or in comparison to their ICE brothers.

Speaker #2: And therefore, from that perspective, I think the demand will remain strong and will continue to grow. In terms of capacity of intra-EV, actually our in-house capacity is not a challenge at all.

Speaker #2: What has happened is not only our electric vehicle demand has gone up, which is leading to a therefore cascading increase in demand of cells from China.

Girish Wagh: What has happened is not only our electric vehicle demand has gone up, which is leading to a therefore cascading increase in demand of cells from China. But even within China, share of electric vehicles has further gone up, which has led to increased demand on the cells. This is something which is currently a bottleneck and the lead time for the demand or lead time for getting the cells in India and converting into batteries is currently pretty high. But I think we have placed higher set of orders already around two months back. So towards the end of this quarter, I think we should have the supplies completely debottleneck from the perspective of the demand as we see. Now coming to costs, is there more cost pressure ahead?

Speaker #2: But even within China, the share of electric vehicles has further gone up, which has led to increased demand on the cells. And this is something which is currently a bottleneck.

Speaker #2: And the lead time for the demand or lead time for getting the cells in India and converting into batteries is currently pretty high. But I think we are blessed higher set of orders already around two months back.

Speaker #2: So towards the end of this quarter, I think we should have the supplies completely de-bottleneck from the perspective of the demand as we see.

Speaker #2: Now coming to costs, is there more cost pressure ahead? Yes. There is further cost pressure ahead of us. In terms of commodities, few of the commodities, steel, rubber, et cetera.

Speaker #2: And it is our endeavor, of course, to ensure that the price hike and our own internal cost management actions enable us to tide over this tough commodity challenge.

Girish Wagh: Yes, there is further cost pressure ahead of us, in terms of commodities, few of the commodities, steel, rubber, et cetera. It is our endeavor, of course, to ensure that the price hike and our own internal cost management actions enable us to tide over this tough commodity challenge. The net price hike in July, so Kapil, we have taken 2.5% increase and very confident that it should pass through as we progress during the quarter. On Indonesia order, I think we have already answered in detail, so we can move to the next question.

Speaker #2: The net price hike in July—so, Kapil, I mean, we have taken a 2.5% increase, and we're very confident that it should pass through as we progress during the quarter.

Speaker #2: On Indonesia order, I think we have already answered. In detail. So we can move to the next question.

Speaker #1: Yeah. The next one, again from Raghu: On e-truck sales, how is profitability different from ICE trucks? And how much is the EV revenue and PLI for the quarter?

[Company Representative] (Motilal Oswal Financial Services): Yeah. The next, again from Raghavan. On E truck sales, how is profitability different from the ICE trucks, and how much is the EV revenue and PLI for the quarter?

Sneha Gavankar: Yeah. The next, again from Raghavan. On E truck sales, how is profitability different from the ICE trucks, and how much is the EV revenue and PLI for the quarter?

Speaker #2: So, there is another question in terms of higher payload trucks, no?

Speaker #1: okay.

Speaker #2: Okay. So there is—okay, Raghu, there is one question from you in terms of higher payload trucks. So yes, I think the acceptance in the market is very good.

Girish Wagh: So there is another question in terms of higher payload trucks.

[Company Representative] (Motilal Oswal Financial Services): Okay.

Sneha Gavankar: Okay.

Girish Wagh: Raghavan, there is one question from you in terms of higher payload trucks. Yes, I think the acceptance in the market is very good, and this is therefore leading to market share gain gradually. Let me say, because you have asked a question whether it is giving a double whammy of market share gain and contribution margin improvement. I think in commercial vehicles, the customers do take time to build a trust in a vehicle, although they have a trust in the brand. For any new vehicle, I think they kind of watch as to what is happening. But at this juncture, I must say that yes, it does make a positive business case for them, these new high payload trucks. The next question you have asked is utilization for HCV tipper is relatively lower than HCV cargo. Is there any worries? No.

Speaker #2: And this is therefore leading to market share gain gradually. Now let me say because you have asked a question whether it is giving a double whammy of market share gain and contribution margin improvement.

Speaker #2: I think in commercial vehicles, the customers do take time to build trust in a vehicle, although they have trust in the brand.

Speaker #2: And for any new vehicle, I think they kind of watch as to what is happening. But at this juncture, I must say that yes, it does make a positive business case for them, these new high payload trucks.

Speaker #2: The next question you have asked is utilization for HCV tipper is relatively lower than HCV cargo. Is there any worries? No. So Raghu, this is quite characteristic.

Speaker #2: From the beginning of the rainy season, tipper utilization does go down. And towards the middle of September, it starts picking up again in many cases.

Girish Wagh: Raghavan, this is quite characteristic. From the beginning of rainy season, the tipper utilization does go down, and towards middle of September it starts picking up again. In many cases, it also starts picking up from 15 August. So it depends on the rainfall activity. This is not something to be concerned about. You asked about the growth in other expenses is much lower than the revenue growth. That is the operating leverage, Raghavan, and we will make all the efforts to get this leverage as we go ahead. There was one more question you said what, from him?

Speaker #2: It also starts picking up from 15th August, so it depends on the rainfall activity. So this is not something to be concerned about. You've asked about growth in other expenses.

Speaker #2: It is much lower than the revenue growth. So that is the operating leverage, Raghu. And we will make all the efforts to get this leverage as we go ahead.

Speaker #2: There was one more question you said what from him?

Speaker #1: Oh, yeah. On e-truck sales, how is profitability different from ICE trucks?

Speaker #2: Yeah. So see, this is something that I also addressed during our investor day. That first is, you know, our endeavor is to sell all the vehicles with PLI benefits.

[Company Representative] (Motilal Oswal Financial Services): Yeah, on E-truck sales. How is profitability

Sneha Gavankar: Yeah, on E-truck sales. How is profitability

Girish Wagh: Yeah

[Company Representative] (Motilal Oswal Financial Services): different from ICE trucks?

Sneha Gavankar: different from ICE trucks?

Girish Wagh: Yeah. So see, this is something that I also addressed during our investor day. First is our endeavor is to sell all the vehicles with PLI benefits. Although I must add that of late, the regulators are taking very long time in giving the certificates, and therefore, in specific cases, to meet customer commitments, I think we have started delivering the vehicles in certain cases. But otherwise, our endeavor is to deliver with full PLI. The profitability will be different from ICE trucks because the scale is pretty low. But I think as the scale improves and we have higher localization, and I think in some quarters from now, we see even cell localization happening gradually. With that, I think we should get back into a good position, Raghavan.

Speaker #2: Although I must add that of late, the regulators are taking a pretty long time in giving the certificates. And therefore, in specific cases, to meet customer commitments, I think we have started delivering the vehicles in certain cases.

Speaker #2: But otherwise, our endeavor is to deliver with full PLI. The profitability will be different from ICE trucks because the scale is pretty low. But I think as the scale improves, and...

Speaker #2: We have higher localization, and I think from some quarters from now, we will see even cell localization happening gradually. With that, I think we should head back into a good position.

Speaker #1: We have a few questions on email. This one is from Pramod Kumar at UBS. He says, "Congratulations team on the strong volume and profit performance."

Speaker #1: His question is, on the pricing environment, are we reaching the limit for price hikes given the sharp surge in steel and rubber? And how's the discounting been across segments?

[Company Representative] (Motilal Oswal Financial Services): We have a few questions on email. This one is from Pramod Kumar, UBS. Says, "Congratulations team on the strong volume and profit performance." Question is, on the pricing environment, are we reaching the limit for price hikes given the sharp surge in steel and rubber? How is the discounting been across segments?

Sneha Gavankar: We have a few questions on email. This one is from Pramod Kumar, UBS. Says, "Congratulations team on the strong volume and profit performance." Question is, on the pricing environment, are we reaching the limit for price hikes given the sharp surge in steel and rubber? How is the discounting been across segments?

Speaker #2: So, I think this is a very delicate balance that we have to achieve. And this is something that I said in Q1 also: that our first line of attack is to see how much cost we can contain.

Girish Wagh: Well, I think this is a very delicate balance that we have to achieve, and this is something that I said in Q1 also, that our first line of attack is to see how much cost we can contain, how much cost we can negate. But beyond that, I think we have no option but to increase the prices. I think what has helped us, I must say, is the modular MY26 that we launched across the portfolio with improved efficiencies and therefore improved TCO. So it helped us to a good extent in terms of stabilizing the new prices. Whether it has reached the limit, it's very difficult to answer in a binary manner. But I can certainly say that the cumulative price increase during this year has been quite significant.

Speaker #2: How much cost we can negate? But beyond that, I think we have no option but to increase the prices. I think what has helped us, I must say, is the model year 26 that we launched across the portfolio with improved efficiencies and therefore improved TCO.

Speaker #2: So it helped us to a good extent in terms of stabilizing the new prices. Whether it has reached the limit, it's very difficult to answer in a binary manner.

Speaker #2: But I can certainly say that the cumulative price increase during this year has been quite significant.

Speaker #1: Yeah. Another question from Pramod Kumar: Can you comment on the current demand environment? July has been very robust. Tight monsoon. What is driving this demand surge?

[Company Representative] (Motilal Oswal Financial Services): Yeah. Another question from Pramod Kumar. Can you comment on the current demand environment? July has been very robust despite monsoon. What is driving this demand surge, and whether it will be sustainable?

Sneha Gavankar: Yeah. Another question from Pramod Kumar. Can you comment on the current demand environment? July has been very robust despite monsoon. What is driving this demand surge, and whether it will be sustainable?

Speaker #1: And whether it will be sustainable?

Speaker #2: So as I mentioned earlier, Pramod, I think the underlying demand fundamentals are pretty strong. Right? We saw e-way bills diesel consumption fast track collection.

Girish Wagh: As I mentioned earlier, Pramod, I think the underlying demand fundamentals are pretty strong, right? We saw e-way bills, diesel consumption, FASTag collection. I think all the indicators indicate a very high moment of goods, which means I think the underlying freight available is pretty robust. We have also discussed that I think this remains directly correlated with the GDP growth. So once the GDP growth is quite robust, what it is today, it also leads to equivalent amount of freight growth, and that then leads to higher demand. So I think at this juncture, yes, I think despite the inflation which is happening in the products as well as the fuel prices, you see the demand remaining quite robust. Is that it?

Speaker #2: I think all the indicators indicate very high moment of goods, which means I think the underlying freight available is pretty robust. And we have also discussed that I think this remains directly correlated with the GDP growth.

Speaker #2: So, once the GDP growth is quite robust, as it is today, it also leads to an equivalent amount of freight growth. And that then leads to higher demand.

Speaker #2: So I think at this juncture, yes, I think despite the inflation which is happening, in the products as well as the fuel prices, we have seen the demand remaining quite robust.

Speaker #2: That's it.

Speaker #1: Yeah. Let me just check. I don't see any other—okay. Another question from Kapil: How is the EV financing scenario? And have historical resale value concerns been addressed?

[Company Representative] (Motilal Oswal Financial Services): Yeah. Let me just check. I do not see any other. Okay, there is. Another question from Kapil. How is the EV financing scenario, and have historical resale value concerns been addressed?

Sneha Gavankar: Yeah. Let me just check. I do not see any other. Okay, there is. Another question from Kapil. How is the EV financing scenario, and have historical resale value concerns been addressed?

Speaker #2: So, the EV finance, retail financing has been improving month over month. And I must say, more and more financiers are having confidence in the technology, in the product.

Girish Wagh: The EV retail financing has been improving month-over-month, and I must say more and more financiers are having confidence in the technology, in the product, and in most cases, we are also offering warranties, battery warranty especially, which is higher than the tenure of the loan, which is giving a very high comfort to the financiers. More and more financiers I meet, I see a lot of comfort amongst them in funding EVs, because their book quality is quite robust, quite okay, as far as EVs are concerned.

Speaker #2: And in most cases, we are also offering warranties battery warranty, especially, which is higher than the tenor of the loan. Which is giving a very high comfort to the finances.

Speaker #2: And more and more financiers I meet, I see a lot of comfort amongst them in funding EVs because their book quality is quite robust, quite okay as far as EVs are concerned.

Speaker #1: Yeah, this is from Jay Kali, Elara. On the demand side, is it replacement demand that is driving the growth? And can you also share some flavor on large fleet operators versus small operators?

[Company Representative] (Motilal Oswal Financial Services): Yeah. This is from Jai Kale, Elara. On the demand side, is it replacement demand that is driving the growth? Can you also share some flavor on large fleet operators versus the small operators or first-time buyers?

Sneha Gavankar: Yeah. This is from Jai Kale, Elara. On the demand side, is it replacement demand that is driving the growth? Can you also share some flavor on large fleet operators versus the small operators or first-time buyers?

Speaker #1: First time buyers.

Speaker #2: So Jay, I actually mentioned this last time also. It is very difficult to differentiate between replacement demand and new vehicle purchase, so to say.

Speaker #2: But traditional I mean, generally what happens is large fleet owners are the first ones to replace their existing trucks in four to six years and they go for newer trucks.

Girish Wagh: So Jai, I actually mentioned this last time also, it is very difficult to differentiate between replacement demand and new vehicle purchase, so to say. But generally what happens is, large fleet owners are the first ones to replace their existing trucks in 4 to 6 years, and they go for newer trucks because they see a clear TCO benefit with the newer trucks. At the same time, their existing trucks don't move out of the system, but they are sold to maybe smaller customers, individual vehicle owners, and they then put those vehicles to use on shorter distances. I think overall the demand is going up, which means there is an increase in the freight which is available, and the capacity utilization of the fleet also remains strong. As I said, it is very difficult to give a separation between replacement demand, new vehicle demand.

Speaker #2: Because they see a clear TCO benefit with the newer trucks. But at the same time, their existing trucks don't move out of the system; they are sold to maybe smaller customers, individual vehicle owners, and they then put those vehicles to use on shorter distances.

Speaker #2: So I think overall, the demand is going up, which means there is an increase in the freight that is available, and the capacity utilization of the fleet also remains strong.

Speaker #2: So as I said, very difficult to give a separation between replacement demand, new vehicle demand. Actually, it is a combination of both.

Speaker #1: The next question is from Amin Pirani, JP Morgan. Q1 working capital and FCF have been surprisingly strong considering normal seasonality. Are there any one-offs, or have any structural changes happened?

Girish Wagh: Actually, it is a combination of both.

[Company Representative] (Motilal Oswal Financial Services): Next question is from Amyn Pirani, JPMorgan. Q1 working capital and FCF has been surprisingly strong, considering normal seasonality. Are there any one-offs or any structural changes have happened?

Sneha Gavankar: Next question is from Amyn Pirani, JPMorgan. Q1 working capital and FCF has been surprisingly strong, considering normal seasonality. Are there any one-offs or any structural changes have happened?

Speaker #2: So I mean, I think we did have some carryover benefit to some extent from Q4. But otherwise, I think the working capital discipline that we have been driving combined with good operating profit has actually helped us to deliver a good FCF in Q1.

Girish Wagh: Amin, I think, we did have some carryover benefit to some extent from Q4. Otherwise, I think the working capital discipline that we have been driving, combined with good operating profit, has actually helped us to deliver a good FCF in Q1. You are right. I think traditionally in Q1 and Q2, we burn working capital. But with the discipline as well as the operating profit, it has led to a good improvement. I must also add that the Indonesia order, and the advance that we received from Indonesia has been the one-off, if I may say so, which has helped us on the cash flow in Q1. Asking here today, what is the reason?

Speaker #2: You are right. I think traditionally in Q1 and Q2, we burn working capital. But with the discipline as well as the operating profit, it has led to a good improvement.

Speaker #2: I must also add that the Indonesia order, and the advance that we received from Indonesia, has been the one, if I may say so, which has helped us with the cash flow in Q1.

Speaker #2: Asking here today, what is the reason?

Speaker #1: think probably struggling some of them to there are some more coming. One minute. There are any other questions on the call?

Speaker #2: So, you want to wait for a few minutes?

[Company Representative] (Motilal Oswal Financial Services): Yeah, I think they are probably struggling, some of them to-

Sneha Gavankar: Yeah, I think they are probably struggling, some of them to-

Speaker #1: Okay. Check if there are any other questions. Let me check on email as well.

[Company Representative] (Motilal Oswal Financial Services): There are some more coming on letter. Are there any other questions on the-

Sneha Gavankar: There are some more coming on letter. Are there any other questions on the-

Speaker #2: Yeah. Is there a question? there is a question from Sreedhar.

Girish Wagh: Do you want to wait for a few minutes?

[Company Representative] (Motilal Oswal Financial Services): Okay. Check if there are any other questions. Let me check on email as well.

Sneha Gavankar: Okay. Check if there are any other questions. Let me check on email as well.

Speaker #1: But I think it largely answered.

Speaker #2: Okay.

Speaker #1: What is the mix of fleet operators and this has been answered? There's a question from Kapil.

Girish Wagh: Yeah. Is there a question? Sridhar. There is a question from, yeah, Sridhar.

Speaker #2: Again.

[Company Representative] (Motilal Oswal Financial Services): But I think it largely answered it.

Sneha Gavankar: But I think it largely answered it.

Speaker #1: Yeah. Can you talk about the export outlook for MHCV and LCV? Maybe two or three years.

Girish Wagh: Okay.

[Company Representative] (Motilal Oswal Financial Services): What is the mix of fleet operators and this has been answered. There is a question from Kapil.

Sneha Gavankar: What is the mix of fleet operators and this has been answered. There is a question from Kapil.

Speaker #2: So Kapil, two to three years is pretty long horizon. But I think we are certainly doing a lot of work in some of the markets that I spoke about.

Girish Wagh: Again,

[Company Representative] (Motilal Oswal Financial Services): Yeah. Can you talk about the export outlook for MHCV and LCV for the next maybe 2 or 3 years?

Sneha Gavankar: Yeah. Can you talk about the export outlook for MHCV and LCV for the next maybe 2 or 3 years?

Speaker #2: Whether it is Africa, and also with the entry that we have in. Indonesia with this order. We are doing some work in other segments also.

Girish Wagh: Kapil, 2 to 3 years is pretty long horizon. But I think we are certainly doing a lot of work in some of the markets that I spoke about, whether it is Africa and also with the entry that we have in Indonesia with this order. We are doing some work in other segments also. This order in Indonesia also has been in light commercial vehicle and pickup. I think we are using this opportunity to do some work and seed our products in other segments also. But very early to give any kind of outlook. But yes, we are doing a lot of work on the demand generation front, as well as launch of new products in some of these international markets. The question, mix software, that we understood.

Speaker #2: I mean, this order in Indonesia has also been in light commercial vehicles and pickups. I think we are using this opportunity to do some work and seed our products in other segments also.

Speaker #2: But it's very early to give any kind of outlook. But yes, we are doing a lot of work on the demand generation front, as well as the launch of new products in some of these international markets.

Speaker #2: The question mix—of that, we understood and answered.

Speaker #1: Yeah.

Speaker #2: No further questions. Any?

Speaker #1: Okay, there's another one on email from Pramod Kumar, UBS. Any comments on operator profitability given the rising prices of trucks? And also, has Tamil Nadu reverted to normal demand post-election-led slowdown?

[Company Representative] (Motilal Oswal Financial Services): Okay.

Sneha Gavankar: Okay.

Girish Wagh: Answered.

[Company Representative] (Motilal Oswal Financial Services): Yeah.

Sneha Gavankar: Yeah.

Girish Wagh: No further question.

[Company Representative] (Motilal Oswal Financial Services): Okay, there is another one on email from Pramod Kumar, UBS.

Sneha Gavankar: Okay, there is another one on email from Pramod Kumar, UBS.

Speaker #2: So the second one is easier. I think yes, Tamil Nadu has been improving in demand month over month. And especially last month was pretty good, very close to normal situation.

[Company Representative] (Motilal Oswal Financial Services): Any comments on operator profitability

Sneha Gavankar: Any comments on operator profitability

[Company Representative] (Motilal Oswal Financial Services): given rising prices of trucks? Has Tamil Nadu reverted to a normal demand post-election led slowdown?

Sneha Gavankar: given rising prices of trucks? Has Tamil Nadu reverted to a normal demand post-election led slowdown?

Speaker #2: As far as Tamil Nadu demand is concerned, what was the first question?

Girish Wagh: The second one is easier. I think, yes, Tamil Nadu has been improving in demand month-over-month. Especially last month was pretty good, very close to the normal situation, as far as Tamil Nadu demand is concerned. What was the first question?

Speaker #1: This was on the rising operator profitability.

Speaker #2: Yeah, okay. Yeah, yeah. So, I think I don't have any index on this, but I can tell you, anecdotally, from discussions that we have had with the customers.

[Company Representative] (Motilal Oswal Financial Services): That I do not know. This was on the rising operator profitability.

Speaker #2: I think depending upon the route, a shipper's and the commodities being transported, the diesel price increase is being passed through. And therefore, gradually the profitability will come back to the earlier level.

Sneha Gavankar: That I do not know. This was on the rising operator profitability.

Girish Wagh: Yeah. Okay. I think I do not have any index on this, but I can tell you anecdotally from the discussions that we have had with the customers. I think depending upon the route, shippers, and the commodities being transported, the diesel price increase is being passed through, and therefore gradually the profitability will come back to the earlier level. Now take the case of we as shippers. We ship our vehicles on tractor-trailers or trucks. I think we, for example, the auto industry has passed through the diesel price increases pretty soon, and there are quite a few other segments also where this has happened, which is then helping the fleet owners to get the profitability back on track.

Speaker #2: Now, take the case of, say, shippers. I mean, we ship our vehicles on tractor trailers or trucks. And I think, for example, the auto industry has passed through the diesel price increases pretty soon.

Speaker #2: And there are quite a few other segments also where this has happened. Which is then helping the fleet owners to get the profitability back on track.

Speaker #1: One question from Himanshu Singh. Should we continue to see market share gains going ahead?

Speaker #2: So that will always remain our endeavor.

[Company Representative] (Motilal Oswal Financial Services): One question from Himanshu Singh: Should we continue to see market share gains going ahead?

Sneha Gavankar: One question from Himanshu Singh: Should we continue to see market share gains going ahead?

Speaker #1: Can you give us a minute, please?

Girish Wagh: That will always remain our endeavor.

Speaker #2: Take from ICS here.

[Company Representative] (Motilal Oswal Financial Services): Give us a minute, please.

Sneha Gavankar: Give us a minute, please.

Speaker #1: Just seeing if the questions are queuing up. Please give us a minute. I think with that, we've mostly answered all the questions. And we can close the call with that.

Girish Wagh: Take from ICICI. Anything.

[Company Representative] (Motilal Oswal Financial Services): Just seeing if the questions are queuing up. Please give us a minute. I think with that we've mostly answered all the questions, and we can close the call with that. Any other questions that remain unanswered, we'll be happy to take them offline. Thank you so much for your time.

Sneha Gavankar: Just seeing if the questions are queuing up. Please give us a minute. I think with that we've mostly answered all the questions, and we can close the call with that. Any other questions that remain unanswered, we'll be happy to take them offline. Thank you so much for your time.

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Q1 2027 Tata Motors Ltd Earnings Call

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