Shares of India's Tata Motors Ltd dropped 3.7% after the Jaguar Land Rover (JLR) owner reported a larger quarterly loss than expected.

Tata Motors blamed supply chain shortages for the miss and reported in an exchange filing that “Demand remains strong despite near-term concerns... the semiconductor supply situation is improving gradually whilst inflation worries persist.”

Shares of the company were trading 1.7% lower at 504.05 rupees ($1 = 74.5950 Indian rupees), at 4:15 GMT. By day’s end on Monday, the stock jumped more than 4% and settled at 517.75 rupees, reported Reuters.

Brokerage Jefferies predicts better times ahead for JLR once the shortage of semiconductor chips eases, retaining its “buy” rating and raising the target price to 635 rupees from 625 rupees.

Tata Motors' consolidated net loss came to 15.16 billion rupees ($203.23 million) in the fourth quarter of 2021, compared to a profit of 29.06 billion rupees in 2020, when demand picked up after pandemic shutdowns ended.

Supply chain challenges that included as acute semiconductor shortage and disruptions that delayed production led to the losses for Tata Motors.

Tata Motors’ earnings before interest, taxes, depreciation, and amortization margin, a key measure of profitability, was 10.2% for the Q4, slightly above estimates of 9.3%.

Company leadership reported they were working directly with chip manufacturers to secure longer-term supplies for JLR.