Tata Motors says about 20% of its revenue comes from non-cyclical businesses, a share it wants to keep growing as commercial vehicle demand growth is set to slow.
Chief Business Operations Officer Girish made the remark on the Q2 FY27 analyst call.
He said the segment is a clear focus area, laid out at the investor day, and works as a natural hedge against the cyclicality the CV industry generally faces. He did not break down which businesses make up the 20%.
Also Read | Layoffs Are Rising In Tech, But These Skills Are Helping People Unlock Better Pay
Why The Hedge Matters
The September quarter showed the cycle at a high. Standalone revenue rose 42% to Rs 23,900 crore on wholesales of 135,100 units. Girish said industry offtake grew 28.4%, while Tata Motors' volumes rose 30.5%.
The comparison base now gets tougher. Girish said Q3 growth is likely to be high single digit or the beginning of double digit, against 21.5% in the same quarter last year.
He expects heavy and small commercial vehicles to see single-digit growth, and named diesel prices and interest rates as key monitorables, noting that a 25 basis point rate hike has already been taken.
ALSO READ | For Tata Motors CV, The Commodity Bill Is Rising Faster Than Its Pricing Power
Costs are adding pressure. Girish said commodity costs could rise a further 150-200 basis points in Q3, after a 540 basis point year-on-year impact, and that this year's four price increases do not cover the inflation.
Chief Financial Officer Ramanan said standalone EBITDA margin was 11.7%, down 90 basis points year-on-year, though flat sequentially.
Where The CBO Sees Growth
Girish pointed to three areas on the call. In parts and services, he said the aftermarket business kept growing, with better spare parts penetration and a stronger customer uptime proposition.
ALSO READ | Tata Motors Q2 Results: CV Arm Swings To Profit At Rs 2,138 Crore, Revenue Jumps 42%
The priority, he said, is a larger and more resilient aftermarket, by improving uptime offerings and expanding service reach.
In digital, he said Fleet Edge renewal rates are improving, which strengthens the recurring revenue opportunity. In e-buses, Smart City operations continued to scale with more than 95% fleet uptime, and the fleet has covered more than 64 crore green kilometres since inception.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
