Tata Motors Q4 net up 18%

MIXED BAG FOR INDIA INC

Riding on high sales, Tata Motors, the country's largest truck maker, today reported an 18 per cent rise in its quarterly net profit.

Its net profit rose to Rs 458.11 crore in the quarter ended March 31,2006, from Rs 388.17 crore in the corresponding period of the previous year. Net sales grew 29 per cent to Rs 6,882.75 crore from Rs 5,338.87 crore.

For the year ended March 31, 2006, Tata Motors has reported a net profit of Rs 1,528.88 crore, an increase of 24 per cent, compared to Rs 1,236.95 crore in the previous year.

The company's net sales improved by 18 per cent to Rs 20,602.20 crore compared to 17,419.13 crore in the previous year. The company declared 130 per cent dividend for 2005-06 against the previous year's 100 per cent.

The Tata Motors stock lost 2.75 per cent in a weak Mumbai market today. The stock closed at Rs 848.90 on the Bombay Stock Exchange, 2.75 per cent drop from yesterday's close of Rs 872.90.

"The key factor that would help in boosting automobile industry growth in future is constant infrastructure development focus of the government like the recent Supreme Court ruling on banning of overloading in trucks," said Ravi Kant, MD, Tata Motors.

Tata Motors, India's third-biggest car maker after Maruti Udyog Ltd. and South Korea's Hyundai Motor Co, sold 1,493,746 vehicles for the year ended March 31, 2006, a growth of 8.4 per cent compared to 1,378,478 vehicles sold during last year.

"Major changes in emission norms, new regulations, increasing fuel prices and interest rates and flood havoc have put brakes on the volume sales of the company, albeit there has been a growth in the topline as well as the bottom line," said Praveen Kadle, chief financial officer of the company.

Kadle said the company outperformed the industry growth in the area of commercial vehicles. "It is only because of the excellent performance of our four-wheeler Ace that the commercial vehicle (CV) market achieved a 10.1 per cent growth. Excluding the sales of Ace, CV market would have grown only by 0.7 per cent," said Kadle.

In January, Tata Motors and Italy's Fiat agreed to share dealer networks in India and abroad and explore more areas. Tata Motors exported 50,000 vehicles in FY 06 compared to 31,000 vehicles in the previous financial year.

For the quarter ended March 31, 2006, Tata Motors' market share in the medium and heavy commercial segment has climbed up to 62.2 per cent from 61.60 per cent.

In the light commercial vehicle segment, its market share has increased to 65.4 per cent from 51.8 per cent in 2004-05.