MUMBAI (Bloomberg) -- Jaguar Land Rover's slowing sales caused parent Tata Motors' second-quarter profit to fall 7 percent. Net income dipped to 32.9 billion rupees ($533 million) in the quarter ended Sept. 30, Tata reported.
Tata's revenue climbed 7 percent to 605.6 billion rupees.
Profit at Jaguar Land Rover fell to 450 million pounds ($705 million) from 507 million pounds a year earlier.
Deliveries at the UK carmaking group, which last month opened a factory in China, rose 8 percent in the fiscal second quarter, slower than the 22 percent pace in the preceding three months, dragged down by a decline in sales in North America.
"You can't always continue to grow every quarter, quarter-on-quarter at the same rate," Ken Gregor, chief financial officer of Jaguar Land Rover, said in Mumbai. "We are very ambitious about our business and investing very heavily in new products, new engines and new capacity."
JLR’s sales increased 4 percent in the quarter to 4.81 billion pounds, Tata said.
The company was unable to meet some demand in the U.S. due to scheduling issues at its plant, Gregor said.
The company's new 130,000-unit-a-year factory in China is expected to ramp up production next year and that, combined with the introduction of the Discovery Sport and the XE sedan is likely to drive growth, he said.
A prolonged slump in domestic demand for Tata Motors' cars and trucks has also dented profit.
A "concern is the discounting in the domestic commercial vehicle business, the volumes are picking up, but the discounts are very high and that could be a drag on earnings," Bharat Gianani, an analyst at Angel Broking in Mumbai.
India's truck market is dominated by fleet owners who are used to getting the discounts, Ravindra Pisharody, Tata Motors' executive director for commercial vehicles, said. The company will start rolling back the discounts once demand picks up, he said, without specifying when that may happen.
Tata Motors revenue climbed 6.5 percent to 605.6 billion rupees.