Profitability improves despite revenue and volume declines. Company said SCV under turnaround plan, 44 new CV products launched, hydrogen truck trials have begin.
13 May 2025 | 1114 Views | By Shahkar Abidi & Ketan Thakkar
Tata Motors is entering FY26 with renewed confidence in its Commercial Vehicle (CV) business, citing a resilient financial performance, a strong product cadence, and improving market share across key segments—even as the broader market navigates global uncertainties and demand-side pressures.
Group CFO P B Balaji said the company’s CV ...
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Tata Motors is entering FY26 with renewed confidence in its Commercial Vehicle (CV) business, citing a resilient financial performance, a strong product cadence, and improving market share across key segments—even as the broader market navigates global uncertainties and demand-side pressures.
Group CFO P B Balaji said the company’s CV operations are now on firmer ground, underpinned by stable macro conditions and internal operational discipline. “All the fundamentals for CV growth are aligning well—steady interest rates, stable fuel prices, low delinquencies, and muted steel inflation. These factors point to stability in the operating environment,” Balaji said during the company’s Q4 FY25 earnings call.
For the January–March quarter, the CV business posted revenue of Rs. 21,500 crore, down 0.5% year-on-year. Despite the marginal decline, EBITDA improved by 20 basis points to 12.2%, EBIT rose by 10 basis points to 9.7%, and profit before tax (before exceptional items) stood at Rs. 2,100 crore.
On a full-year basis, the CV division reported revenue of Rs. 75,000 crore, with EBITDA margin at 11.8% (up 100 bps), EBIT margin at 9.1% (up 90 bps), and PBT before exceptional items at Rs. 6,600 crore—confirming that profitability improved despite topline pressure, which Balaji noted was “probably happening for the first time in 25 years.”
Market Share Strengthens Across Segments
Tata Motors maintained a domestic CV market share of 37.1% in FY25. Notably, it held steady in the HCV segment at 48.8%, gained in the medium CV segment at 37.3%, and continued improving in passenger carriers at 37.6%. The light commercial vehicle (LCV) segment stood at 30.5%, an area where Balaji acknowledged that “work is still underway.”
The company launched 44 new products and introduced 139 variants during the year—part of its broader effort to address evolving customer needs, technology shifts, and emission mandates. Among the key milestones were India’s first-ever hydrogen-powered heavy-duty truck trials, with 16 trucks already operational across key freight corridors.
SCV Segment a Key Focus, EV Portfolio Expands
Within CVs, the Small Commercial Vehicle (SCV) business remains a strategic area of intervention. “The part of the CV business we need to fix is SCV—and that’s exactly where we are focused. Delivering a turnaround here is a top priority,” Balaji stated.
To reinforce its EV roadmap in the commercial space, Tata Motors also launched the Ace EV1000—an upgraded electric mini-truck with higher payload capacity and extended range, aimed at scaling adoption in last-mile delivery.
“If growth returns, this business is going to turbocharge. There are many things working in our favour. We’re very optimistic about the CV segment,” Balaji said.
Passenger Vehicle Snapshot: Margin Focus Amid Revenue Decline
In the Passenger Vehicle (PV) segment, Tata Motors reported Rs. 12,500 crore in Q4 FY25 revenue, a decline of 13.1% year-on-year. However, EBITDA margin improved by 60 basis points to 7.9%, while EBIT margin declined by 130 basis points to 1.6%, with profit before tax and exceptional items at Rs. 400 crore for the quarter.
On a full-year basis, the PV division delivered Rs. 48,400 crore in revenue, with an EBITDA margin of 6.9%, EBIT margin of 0.9%, and PBT (before exceptionals) of Rs. 1,100 crore.
Balaji reiterated that despite revenue softness, the PV business remains focused on margin protection, cost optimization, and scaling its presence in both ICE and EV segments.