Tata Motors’ EV biz one of the few to report positive Ebitda margin

Mumbai: Tata Motors’ electric vehicle business posted a positive operating margin before depreciation and amortisation (Ebitda margin) last fiscal year, ranking among a handful of EV makers globally to achieve this, the Mumbai-based auto maker claimed in its latest annual report.

The improved performance was supported by increased localisation, aggressive cost cuts, and productivity linked incentive (PLI) benefits, with the latter totalling Rs 527 crore. It Includes PLI incentives of Rs 385 crore for the financial year 2025 and payment of Rs 142 crore as incentives for the financial year 2024.

This was even as Tata Motors’ EV sales declined while its market share slipped amid heightened competition from companies such as MG Motor and Mahindra & Mahindra.

India’s EV market leader with six models including Tiago and Nexon saw revenue from the EV business drop to Rs 8,187 crore in FY25 from Rs 9,285 crore in the year before. Its retail market share fell to 55.4% from 73.1% during the period. Still, Ebitda margin rose 8.3 percentage points to 1.2% from a negative 7.1%.

“In the EV segment, we became one of the few global manufacturers to achieve positive EBITDA, on the back of a higher level of localisation, aggressive cost reduction, and securing PLI benefits,” the company said in the FY25 annual report.

Tata Motors’ other income last fiscal included government incentives that rose sharply to Rs 3,458 crore from Rs 2,971 crore in the year before. This included exports and other incentives of Rs 1,021 crore and Rs 617 crore for FY25 and FY24 respectively, and Rs 2,438 crore and Rs 2,354 crore for FY25 and FY24, respectively received by foreign subsidiaries on tax credit on qualifying expenditure for research and development.

Meanwhile, it was a year of record foreign exchange earnings for the company's UK unit Jaguar Land Rover. The luxury carmaker recorded an exchange gain of Rs 981 crore in FY25, compared to ?190 crore in FY24 on account of foreign exchange and fair value adjustments, according to the annual report.