Tata Motors profit up on better volumes, margins

[sajiv]

Tata Motors profit up on better volumes, margins

MUMBAI: Tata Motors has reported a net profit of Rs. 729.14 crore for the second quarter of 2009-10, against Rs. 347 crore in the year-ago period, a 110 per cent jump. A recovery in volumes combined with improved realisations contributed to the growth in revenues which improved by 12.7 per cent to Rs. 7,978.80 crore (Rs. 7,078.90 crore).

Stable material prices and cost reduction efforts benefited margins and for the second quarter in a row, operating margin improved. It moved up to 13.4 per cent from 7.6 per cent in the same period last year. Profit before tax zoomed to Rs. 907 crore from Rs. 358 crore. The figure for the corresponding quarter of 2008-09 was after considering notional foreign exchange loss (net) of Rs. 245.23 crore. Sales volume (including exports) grew 17.4 per cent to 1.58 lakh vehicles (1.35 lakh units). Although revival in industrial activity and improvement in liquidity improved the company's domestic sales, exports were sluggish due to continued slowdown in prime markets and volatility in exchange rates.

In the domestic market, the company gained in market share in commercial vehicles (CVs) to 65.5 per cent (62 per cent) on the back of a 20 per cent growth in domestic sales to 89,655 units. Significantly, for the first time in four quarters, the company's medium and heavy commercial vehicles (M&HCV) sales saw a year-on-year growth while industry sales in the segment continued to be flat. In light commercial vehicles (LCVs), there was a growth of 33 per cent.

In passenger vehicles (PVs), including Fiat, Jaguar and Land Rover, sales were up 27.3 per cent in the domestic market at 60,917 units with a market share of 11.6 per cent. The company has so far delivered more than 7,500 Nanos from its Uttarakhand plant.

P. M. Telang, Managing Director, said, "We are making around 100 units of Nano a day and will soon go to 150. Efforts are on to speed up work on the Sanand facility and we will see some production in the fourth quarter and full production 4-5 months thereafter".