JLR sales drive Tata profits to Rs2k crore

JLR’s net profit in Q2 stood at £238 million or around Rs 1,715 crore. JLR’s sales volume grew 72 percent to 5,801 units. China, where the company is planning to set up an assembly facility, contributed to 10 percent of JLR’s sales.

JLR will commence local assembly of Land Rover, the Freelander2 in India in 2011 and later assemble Jaguar brand cars. The company will use the Tata facility at Pune earlier used by Mercedes-Benz to assemble the SUV. Overall, Tata Motors plans to invest £800 million-£1 billion per annum in JLR and Rs 3,000 crore in Tata's Indian operations on an average.

Tata Motors’ standalone net sales were Rs 11,450 crore as against Rs 7,923 crore last year. Net profits at Rs 433 crore were down from Rs 729 crore during the same period last year. In 2009, there was a significant gain from sale of investments. Cost pressures and supply chain bottlenecks impacted operating margins which were 9.7 percent, resulting in an operating profit (ebidta) of Rs 1,118 crore in the quarter, a small growth over Rs 1,066 crore in Q2 of last fiscal.

C Ramakrishnan, CFO, Tata Motors, said favorable economic conditions, good monsoons and good availability of finance led to robust domestic demand in the quarter that increased volumes across all segments. In the domestic market, CV sales increased by 23.4 percent year-on-year to 110,630 units accounting for a 61.1 percent marketshare. In passenger vehicles, marketshare stood at 14 percent as compared to 13 percent in H1 2009-10.

Meanwhile, Tata Daewoo Commercial Vehicles registered a year-on-year quarterly decline of 8.5 percent in net revenues as a result of lower exports and the setting up of a distribution company.