At the Tata group company’s key UK operations of Jaguar and Land Rover (JLR) which account for nearly 78% of its consolidated revenues, the company had faced several operational headwinds in the first quarter of FY27 – a fire at a major component supplier at the start of the quarter, disruptions related to the Middle East crisis and the planned wind down of outgoing Jaguar models ahead of the launch of Jaguar Type 01.
Also, in the September 2025 quarter, the company had faced the impact of a cyber incident at its UK operations.
To Tata Motors Passenger Vehicles’ credit, it has shown signs of a recovery from the above operational problems it faced in its September 2026 quarter. The company had also launched Range Rover Electric in the second quarter of FY27, and it is expected to be in showrooms by December 2026. In addition, it has also launched Jaguar Type 01, and these models are expected to drive growth, going forward.
The ₹6,738Cr One-Off: Inside Tata Motors’ Q2 Deficit
Tata Motors Passenger Vehicles’ sales volumes (wholesales) at its key UK operations rose 24.7% y-o-y to 82,500 units in the quarter under review and that was thanks to improved demand for Ranger Rover and Defender models in UK, USA and Europe, and it offset sluggish demand in the Chinese market. The company has recovered from a low base effect a year earlier on account of the impact of the cyber incident at its UK facility.
The company has highlighted revenues at its key UK operations were £ 5.9 billion (nearly Rs 73,500 crore) in the quarter and they rose 20.3% y-o-y.
At its smaller Indian operations, the company has also highlighted record quarterly sales of more than 200,000 units in the quarter, a growth of more than 40% y-o-y. Tata Motors Passenger Vehicles, like other players, benefited from another quarter of strong demand in the domestic market. Its EV volumes in the quarter also grew 90% y-o-y and its standalone results, which reflect the smaller domestic operations, recorded highest-ever quarter revenue of Rs 19,201 crore, a growth of 48.2% y-o-y.
Meanwhile, the company’s consolidated revenue from operations, which reflect both Indian and UK operations, grew a healthy 34% y-o-y to Rs 96,920 crore in the quarter.
To the company’s credit, recovery in sales volumes in UK operations coupled with strong local demand helped to partially offset surging raw material costs, especially steel and copper, amongst others. Tata Motors Passenger Vehicles had an operating loss of Rs 3,631 crore in the quarter as compared to an operating loss of Rs 8,727 crore a year earlier.
Its profit before exceptional items and tax was Rs 403 crore as compared to a loss of Rs 5,462 crore a year earlier.
The company had an exceptional loss of Rs 6,738 crore in the quarter including Rs 3,776 crore related to employee separation cost coupled with the write down of assets and that is understood to be at its UK operations.
As a result, Tata Motors Passenger Vehicles had a consolidated loss from continuing operations of Rs 5,451 crore as compared to a consolidated loss of Rs 6,368 crore a year earlier.
Core Operations: The Q2FY27 Auto Sector Grid
Source – Company results and investor presentation, and Screener.in
* growth in Mahindra & Mahindra’s SUV sales
**retail sales for JLR
*** Consolidated results
M&M’s 26% SUV Surge Balances the Tractor Deficit
Mahindra & Mahindra (M&M) has performed well in its core auto business, where it is a leading player in the SUV segment, its sales grew 26% y-o-y to 183,000 units in the quarter, and that was thanks to models like, CNG-based XUV 3XO ZNG. The company has also pointed out to strong demand for its E-SUV, including models like BE 6 Sporteq.
In addition, LCV (light commercial vehicles) with a capacity of less than 3.5 tonnes, sales grew 19% y-o-y to 83,000 units in the quarter.
For perspective, M&M had grown its SUV sales by 15% y-o-y to 1.74 lakh in the June 2026 quarter.
However, in its farm equipment business, where the company is the largest player, the first signs of the impact of the deficient monsoons this year were visible, and tractor sales declined 6% y-o-y to 116,000 units in the second quarter of FY27. The company attributed the decline to a shift in festival dates.
Nevertheless, strong performance in its auto division helped M&M’s standalone revenue from operations rise 27% y-o-y to Rs 42,477.4 crore in the quarter under review.
However, higher input costs like steel and copper, amongst others, resulted in its operating profit margin declining nearly 280 basis points y-o-y to 11.7% in the quarter. Mahindra & Mahindra had faced a similar pressure on operating profit margins in the first quarter of FY27.
Auto companies had hiked prices in the first half of FY27 however, it did not fully offset the cost pressures. Its standalone net profit rose 12.9% y-o-y to Rs 5,101.6 crore in the second quarter of FY27, and that was once again thanks to strong sales of SUVs and LCVs.
The 310 BPS Squeeze: Maruti’s Record Sales vs. Margin Hit
Maruti Suzuki India has highlighted its highest-ever quarterly sales of 696,654 units, a growth of 26.5% y-o-y, in the quarter under review. The company has highlighted very strong demand for its recently launched SUV, Victoris, and it helped sales in the higher-margin SUV rise by a buoyant 68.2% y-o-y in the quarter.
SUV makers have benefited from the government reducing the GST on these vehicles to 40% in September, 2025 from the earlier 43% to 50%.
The strong operational performance helped Maruti Suzuki India reports its highest ever net sales in a quarter – its standalone net sales rose 26% y-o-y to Rs 53,340.2 crore in the quarter under review.
Like other players in the auto segment, higher input costs of steel and copper, amongst others, hurt operating margins, and earlier price hikes were not adequate. And Maruti Suzuki India’s operating profit margin declined 310 basis points to 8.9% in the quarter.
Its other income also declined nearly 55% y-o-y to Rs 429.8 crore on account of mark-to-market losses on its investments. Higher raw material costs coupled with lower other income resulted in Maruti Suzuki’s standalone net profit declining nearly 27% y-o-y to Rs 2,414.9 crore in the quarter.
Maruti Suzuki India has an order backlog of nearly 200,000 units at the end of the second quarter of FY27.
Hyundai’s Hatchback Rebound vs. Raw Material Pressures
Hyundai Motor India grew its sales volume by 14.7% y-o-y to 219,072 units in the quarter under review, and that was thanks to strong performance in the domestic hatchback segment, like Grand i10, rising 41% y-o-y.
In contrast, in the first quarter of FY27, the company had faced temporary production disruptions and its total vehicle sales declined 1.3% y-o-y to 1.78 lakh units.
Improved sales volumes in the September 2026 quarter helped Hyundai Motor India’s standalone revenue from operations grow 18.3% y-o-y to Rs 20,191 crore in the quarter.
Higher input costs also hurt Hyundai Motor India. Its operating profit margin declined nearly 450 basis points y-o-y to 9.5% in the quarter under review.
Higher raw material costs also resulted in Hyundai Motor India’s standalone net profit declining nearly 24% y-o-y to Rs 1,188.5 crore in the quarter.
The core automobile business for Mahindra & Mahindra, Maruti Suzuki India and Hyundai Motor India is reflected in their respective standalone quarterly results.
Return on Equity: The Q2 One-Off Distortions
Mahindra & Mahindra has a standalone return on equity of 23.1%, according to Screener.in, and 14.3% for Maruti Suzuki India, and 30.3% for Hyundai Motor India.
Tata Motors Passenger Vehicles had a consolidated return on equity of 75.7%.
Tata Motors Passenger Vehicles races ahead of rivals in efficiency
Source – Screener.in
The FY27 EV Pipeline: Mapping the Next Growth Catalysts
Four-wheeler manufacturers have strong vehicle launch plans, especially electric vehicles, to leverage strong demand conditions going forward.
For instance, Tata Motors Passenger Vehicles at its key UK operations had launched Range Rover Electric in the second quarter of FY27, and it is expected to be in showrooms by December 2026. In addition, it has also launched Jaguar Type 01, and these models are expected to drive growth, going forward.
Maruti Suzuki is expected to launch Maruti Suzuki e Vitara, a dedicated battery electric vehicle. In addition, it has plans to launch Maruti Suzuki Fronx EV.
Meanwhile, Mahindra & Mahindra’s launches planned include Mahindra Thar.e, an electric SUV, and Mahinda BE.07, an electric SUV.
And Hyundai Motor India new launches planned include Hyundai Ioniq P.
Festive Demand vs. Peak Input Costs: The Q3 Outlook
Vehicle sales are expected to continue to remain buoyant in the current festive season. The four-wheeler models launched a few months earlier by the various manufacturers are expected to play a key role in the growth momentum, going forward.
Investors will be closely monitoring any signs of premiumisation of vehicles in the current festive season. However, the RBI has recently raised policy rates and auto loan rates are expected to rise at a time when fuel prices remain elevated.
Investors will also be monitoring input costs, like steel and copper, and the ability of four-wheeler manufacturers to pass them on to consumers. Maruti Suzuki had hiked prices by up to Rs 20,000 in September, 2026.
Valuation Check: Order Backlogs and Technical Triggers to Watch
Tata Motors had declared its results after the close of Friday trade. However, the stock had ended 3.4% lower to Rs 287 on Friday, and it is hovering above its 52-week low of Rs 259.2 that was reached on 28 October,2026.
Tata Motors trades at a consolidated P/E of 106 times, according to Screener.in.
Maruti Suzuki India trades at a standalone P/E of 30.9 times, while it is 24.5 times for Mahindra & Mahindra, and 37.5 times for Hyundai Motor India.
Does it still make sense to buy four-wheeler stocks?
Source-Screener.in
Maruti Suzuki India has an order backlog of nearly 200,000 units at the end of the second quarter of FY27. In addition, Maruti Suzuki India is expected to fully realise the benefits of its recently commissioned second plant in Kharkhoda, Haryana during FY27.
Readers can put Maruti Suzuki India, Mahindra & Mahindra, and Hyundai Motor India to their watch list of stocks, and see if performance matches expectations.
Disclaimer
Amriteshwar Mathur is a financial journalist with over 20 years of experience.
The writer and his family have no shareholding in any of the stocks mentioned in the article.
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