Jaguar Land Rover on Monday forecast free cash flow for the third quarter at more than 400 million pounds ($485 million), after reporting a 15% rise in wholesale volumes for the period on strong demand and improved chip supply.

The British automaker, in its earnings statement for the second quarter, had forecast a positive cash flow for the second half of fiscal year 2023 and “near breakeven” for the full year.

Tata Motors, which acquired JLR in 2008, had earlier set a target of 1 billion pounds of free cash flow for the fiscal year.

Meanwhile, December quarter wholesales – excluding its joint venture in China – were up 15% from a year earlier at 79,591 units.

Retail numbers for the three months ended Dec. 31, were up 5.9% on a year-on-year basis at 84,827 units.

The total order book at December-end rose by around 10,000 to 215,000 client orders from Sept. 30, Jaguar said, adding that demand for the New Range Rover, New Range Rover Sport and Defender comprised 74% of the order book.
JLR’s performance is key to India’s Tata Motors as it contributes nearly 60% to the group’s revenue from operations.

However, wholesale volumes in China, Jaguar’s biggest market where it produces cars from Changshu, were down 13% compared to the previous quarter due to COVID-19 impact, Jaguar said in a statement.

JLR is expected to report its results for the third quarter on Jan. 25.