Commercial vehicle demand rose in Q2 after GST rate rationalisation: Tata Motors CEO

Mumbai, Nov 12 (PTI) The commercial vehicle demand has "done well" after the GST rate rationalisation with the market picking up in the September quarter following a drop in the April-June period of the fiscal year, Girish Wagh, Managing Director and CEO of Tata Motors Ltd, said.

Wagh also said the listing of the commercial vehicle business will enable the company to have a good sharper strategic focus on the overall CV and logistics value chain and look for opportunities within that.

Earlier, shares of Tata Motors commercial vehicle business now known as Tata Motors, got listed on the bourses following the demerger of the CV business from the passenger vehicle business.

The merger took effect from October 1.

"I think first half of the year has been largely flat but with nuances, in the first quarter, one had seen a drop, but in Q2 the market has picked up, especially I must say that post the GST rate rationalisation the demand has done well, one has seen impacts of GST rate rationalisation," Wagh told PTI.

"We have also seen a secondary impact, which is due to overall consumption growth, the freight being transported on road is going up which has led to higher utilisation of trucks and therefore fleet owners are going for more numbers of heavy-duty long-haul trucks," he said.

Expecting a "far better" second half than the first, he said the products are absolutely the heart of the company's business while it continues launching new products.

He said the listing will also strengthen the governance, which Tata Motors is known for.

Stating that the just-listed entity should be looking at good value creation in this (EV) business, he said, "In the light and small commercial vehicles category, we already have two products and with the recent launch of Ace Pro electric, I think we are seeing a significant pull because of the vehicle being lowest priced four wheeled EV in the country and therefore we are seeing significant pull for that.

"We will also see a lot of action happening from the company on electrification in medium and heavy-duty trucks also, we have been working on that. In addition to that, we have also been working on some advanced technology projects, including hydrogen," he said.

At the listing ceremony, he said the trading of the company's shares on the bourses is a "moment of renewal, of sharper focus and of bold ambition that will reshape the future of mobility".

"Tata Motors commercial vehicle business has long powered India's industrial progress and is now poised to lead global logistics and sustainable mobility," he said.

Over the last few years, the company has driven structural shifts within the business, which have yielded results in the form of strong margin growth, robust cash flows and high return on capital employment while pivoting decisively towards digital and sustainability, Wagh said.

"Here on, we will accelerate our efforts to build a company that is financially fit, delivering profitable growth, a company that is leveraging digital and technology to enhance customer value, ecosystem integration and operational efficiency," he said.

"Internationally, we are scaling with deeper partnerships and expanding footprints across Africa, the Middle East and Asia," he added. PTI IAS TRB