TVS Motor clocks Rs 196.41 cr profit in Q2, reports revenue of Rs 4,617 cr

Production and sales improved from July as supply chain was strengthened despite the Covid-19 pandemic, says company.

TVS Motor on Wednesday reported a profit of Rs 196.41 crore during the quarter ended September 30, 2020 as compared to Rs 255.01 crore a year ago. The company reported a revenue of Rs 4,617 crore in the second quarter of 2020-21 as against Rs 4,353 crore in the second quarter of 2019-20, registering a growth of 6 per cent. 

TVS Motor said it strengthened supply chain in the second quarter during Covid-19 pandemic. Production and sales improved from July onwards. Strong focus on cost reduction initiatives helped the company to improve EBITDA for the quarter to 9.3 per cent compared to 8.8 per cent during Q2 of 2019-20, said the company.

In July 2020, the total two-wheeler sales was 2.44 lakh, and was later improved to 2.77 lakh in August. In September, sales grew by 4.2 per cent to 3.13 lakh.

Total two-wheeler sales of 8.34 lakh for the quarter was almost in line with last year second quarter number of 8.42 lakh. Two-wheeler export sales grew by 7.8 per cent compared to Q2 of last year. Motorcycles registered a sale of 3.66 lakh units in the quarter ended September 2020 as against sale of 3.42 lakh units in the quarter ended September 2019. 

The scooter segment registered a sale of 2.70 lakh units as against 3.33 lakh units in the quarter ended September 2019. Total three wheelers registered sales of 0.33 lakh units in the quarter ended September 2020.
 

"In the urban market, demands are back to the pre-Covid levels, while sentiment in rural markets are good. In both urban and rural markets, premium products are seeing good traction," said K N Radhakrishnan, Director and Chief Executive Officer.

"We are cautiously optimistic about the festival season," said Radhakrishnan, adding TVS will grow faster than the market in both domestic and export markets with the existing product portfolio and new products.

The CEO said THE GST reduction will aid the revival of the market and is hopeful to keep the margin momentum in the third quarter on the backdrop of products and cost management initiatives. 

Meanwhile, the company has reinstated the salary cuts with effect from October 1 as the company sales are increasing.