Tata Motors sees JLR posting loss in Apr-Jun com

Tata Motors Ltd expects its luxury car subsidiary Jaguar Land Rover to remain loss-making in Jul-Sep, as recovery in demand is still nascent and the company is trying to reduce inventory in its dealer channels, according to a report by Edelweiss Securities.

JLR usually contributes over 70% to the consolidated sales of Tata Motors. Tata Motors had given a similar guidance for Jaguar Land Rover at the time of detailing Apr-Jun earnings at the end of

July. Jaguar Land Rover reported a loss before tax of 413 mln pound sterling (around 41 bln rupees) for the quarter ended June.

JLR's dealer inventory in March and April was exceptionally high, which has now started to ease with the reopening of economies and pick up in demand.

The company intends to reduce inventory days--the average number of days it holds vehicles in its channels before selling them--to 55 days by September.

The inventory days fell to 70 days in July from 140 days in May and 90 days in June, the brokerage said, citing Tata Motors' ments at a conference.

The company believes some improvement may be seen in commercial vehicle sales in India as freight activity is recovering, as suggested by increased diesel consumption and other data. Edelweiss is optimistic about JLR's upcoming product pipeline, which will improve the mix in favour of the high-margin Land Rovers.

The brokerage has retained a "buy" rating on the stock as it believes the worst is behind in terms of the crash in demand, and tight control on costs should bolster