Force Motors posts higher quarterly profit on strong demand, one-off gain

Forces Motors' quarterly profit before exceptional items and tax rose 27.5% to 2.73 billion rupees from a year ago. It recorded a one-off income of 3.95 billion rupees from government incentives

Indian automaker Force Motors on Friday reported a more than three-fold rise in fourth-quarter profit due to higher sales of its multi-seater vans, which are also used as school buses and ambulances, as well as a one-off gain. The company, which makes engines for BMW and Mercedes cars in India, posted a consolidated net profit of 4.35 billion rupees ($50.96 million) in the quarter ended March 31, compared with 1.4 billion rupees a year ago.

Forces Motors' quarterly profit before exceptional items and tax rose 27.5 per cent to 2.73 billion rupees from a year ago. It recorded a one-off income of 3.95 billion rupees from government incentives.

 

Meanwhile, the company's total sales rose 19.5 per cent in the fourth quarter. Increased government spending and buoyant passenger carrier demand, which includes a majority of Forces Motors' fleet, helped the sale of commercial vehicles in the country, an industry body said. The company gets about 56 per cent of its turnover from commercial vehicle sales and the rest comes from contract engine manufacturing, according to its last annual report.

Its revenue from operations increased 17.1 per cent to 23.56 billion rupees in the fourth quarter, while total expenses grew 16 per cent to 21.06 billion rupees, led by an 11.7 per cent growth in cost of materials consumed.

Forces Motors' shares closed 1.2 per cent lower before the company reported its quarterly results. The stock rose about 38.9 per cent in the three months ended March 31.