Jaguar And Land Rover Weigh On Tata Motors

(Reuters) – TATA MOTORS, India’s largest vehicle maker, posted a consolidated loss for its fiscal first quarter; but remained confident about the prospects of its loss-making Jaguar and Land Rover (JLR) unit.

The company, which controls about 60% of the world’s fifth-biggest truck and bus market, said today that increased borrowing to support investments and new product development caused an increase in depreciation and interest costs.

It said JLR unit’s sales fell about 52% in the quarter from a year ago due to adverse global market conditions.

‘When volumes are down so much, it is a challenge. We need a little bit of support from the market,’ Vice Chairman Ravi Kant said.

‘I have no doubt that JLR will be a very profitable company when the market starts to revive,’ he said.

The unit was focussed on aligning production with demand, reducing costs and working capital requirements, chief financial officer C. Ramakrishnan said.

‘The improvement in margins at an operating level to 2.4% in the quarter from 1.7% (for the year ending March 2009) is encouraging; it shows that there is an uptick in performance. That gives some confidence,’ said Vaishali Jajoo, an analyst with Angel Broking.

The company reported a 3.29 billion rupees (41.6 million pounds) consolidated loss for April-June.

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