Tata Motors Limited shares gained over 3 per cent to hit a fresh 52-week high of Rs 665 in the early trade on Wednesday, with 22 lakh shares changing hands on the National Stock Exchange (NSE).
The board of directors approved the cancellation of DVRs and will replace them with ordinary shares. Under the proposed scheme, the company will issue 7 fully paid-up ordinary shares of face value Rs 2 each for every 10 DVRs. This issuance will serve as consideration for the reduction and cancellation of ‘A’ ordinary shares.
Shares of Tata Motors DVR rallied around 18 per cent to hit their fresh 52-week high of Rs 440 on the BSE in opening deals after Tata Motors announced it would convert its DVR shares to ordinary shares. On the NSE, the stock gained 17 per cent.
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Tata Motors reported a consolidated net profit of Rs 3,203 crore for the first quarter, boosted by the improved margin of its passenger vehicle business and increased sales at its luxury car unit Jaguar and Land Rover (JLR). The company’s capex spending increased twofold to Rs 1,964 crore in the first quarter.
Revenue from operations grew 42 per cent to Rs 1.02 lakh crore in the reported quarter. EBITDA (earnings before interest, taxes, depreciation, and amortisation) for the June quarter stood at Rs 14,700 crore, the company said in a stock exchange filing on 25 July.
Jaguar Land Rover, Tata Motors’ British arm, reported a 57 per cent increase in revenue to £6.9 billion. The improvement came on the back of robust wholesales and a better product mix. However, commercial vehicle (CV) volumes witnessed a decline of 15 per cent compared to the year-ago period, driven by the transition to BS6 Phase 2.
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Several brokerage firms are positive on Tata Motor’s first quarter earnings after the automobile major beat analyst estimates by a healthy margin.
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