MUMBAI: Tata Motors Ltd., India's biggest automaker, led Indian stocks higher after sales at its main Jaguar Land Rover unit rose more than analysts estimated.
Tata Motors shares rose as much as 5.2% to 238.40 rupees after the company reported deliveries at its British luxury-automobile unit increased 35% to 30,094 vehicles in May, exceeding the 28,175 average estimate of 11 analysts surveyed by Bloomberg. The stock was changing hands at 237.45 rupees as of 12:34 p.m. in Mumbai and was the biggest gainer on the 30-member BSE India Sensitive Index.
Jaguar Land Rover, which generates most of its Indian parent's revenue, benefited from demand in China and for its Range Rover Evoque sport-utility vehicle. Deliveries of Land Rover vehicles jumped 42% to 25,752 units, while sales of Jaguar-brand cars climbed 3% to 4,342, Mumbai-based Tata Motors said in a statement today.
"China's luxury car market is propelling JLR's sales as the luxury car segment continues to grow," said Mitul Shah, an analyst at Karvy Stock Broking Ltd. in Mumbai. "Continuing demand for the Evoque and the fact that China's luxury car sales are not slowing are strong indicators of the positive outlook for the company."
Jaguar Land Rover, based in Gaydon, England, generated 63% of revenue at Tata Motors for the year ended March 31, up from 57% a year earlier. Rising sales in China and Russia helped the automaker offset the slowdown in Europe. Tata Motors plans to invest 2 billion pounds (US$3.1 billion) in the unit this year to develop new models and expand factories to tap increasing demand for its products.
The unit is planning to boost output after global sales surged 51% in March from a year earlier. The company said March 13 it would add 1,000 jobs and move to three-shift, 24- hour production at its Halewood plant in England to meet demand for models such as the Evoque.
Tata Motors in March announced it plans to form a joint venture with China's Chery Automobile Co. to build luxury cars for the world's largest auto market. The venture, to be based in the eastern city of Changshu in Jiangsu province, will have production capacity of 130,000 vehicles annually, according to a statement posted on China's Ministry of Environmental Protection's website.
Jaguar will unveil the F-type sports car in September that will go on sale as early as next April to boost sales. The automaker will introduce a station wagon version, also known as an estate model, for the XF this year. (Bloomberg/aph)
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