Tata Motors returns to profit in Q3 despite exceptional charges

MUMBAI: After a quarter that put the brakes on, Tata Motors hit the accelerator again albeit with a few costly speed bumps. Tata Motors Limited reported a standalone net profit of Rs 561 crore for the quarter ended December 31, 2025, swinging back into the black from a loss of Rs 1,021 crore in the September quarter, even as hefty one-off charges continued to cloud the road ahead.

Revenue from operations rose sharply to Rs 20,404 crore in Q3, up from Rs 16,861 crore in the preceding quarter and Rs 17,040 crore a year ago, reflecting stronger volumes and operating momentum. Total income for the quarter stood at Rs 20,676 crore.

The turnaround, however, came with caveats. Exceptional losses of Rs 1,545 crore largely linked to impairment provisions, stamp duty charges and the statutory impact of new Labour Codes dragged profit before tax down to Rs 773 crore, compared with Rs 1,603 crore in the year-ago quarter. After tax, profit settled at Rs 561 crore.

For the nine months ended December 31, 2025, Tata Motors posted a standalone profit of Rs 956 crore on revenues of Rs 52,947 crore, a marked improvement from the same period last year, when profit stood at Rs 2,060 crore on revenues of Rs 32,558 crore, reflecting the impact of restructuring and the demerger process.

Operating metrics showed steady traction. The operating margin for the quarter was 13.45 per cent, broadly in line with historical levels, while net profit margin remained slim at 2.75 per cent, underscoring the pressure from exceptional items and higher costs. Earnings per share for Q3 came in at Rs 1.52, compared with a loss of Rs 2.77 in Q2.

The company’s balance sheet strengthened post-demerger, with net worth at Rs 11,003 crore and a debt-equity ratio of 0.29 times, sharply lower than last year. Inventory and debtor turnover ratios also improved, signalling tighter working capital management.

In short, Tata Motors’ standalone numbers tell a familiar story, demand and revenues are doing the heavy lifting, but extraordinary charges are still riding shotgun. The direction of travel looks positive, the ride, for now, remains a little uneven.