Tata posts 25 percent rise in net profit

Tata Motors stated its profit after tax for the year ended March 31, 2007 rose 25 percent to Rs 1,1914 crore versus Rs 1,529 crore during the last fiscal. Its revenues (net of excise) stood at Rs 31,885 crore compared to Rs 24,000 crore in 2005-06.

The automaker’s net profit for the fourth quarter ended March 31 was Rs 577 crore as against Rs 458 crore in the corresponding period last year. The revenues (net of excise) for the quarter rose 20 percent at Rs 8,267 crore.

Tata’s sales volume in the March quarter was up 16 percent at 172,355 units, compared over 148,343 units sold in the same quarter a year ago. The company’s full year sales including exports was at 580,280 units, over 454,129 vehicles sold last year. Sales of commercial vehicles in the domestic market were the highest ever as this increased by 39 percent to 298,586 units. This helped increase market share in the CV segment to 64 percent.

Passenger vehicle sales rose 21 percent to 228,220 units. However, a growth in the company’s market share was impacted due to increasing competition and a loss of production due to a fire at the car plant’s paint shop, according to chief finance officer, Tata Motors, Praveen Kadle. As a result, the market share in passenger cars remained flat at 16.4 percent.

Kadle also cautioned that higher raw materials costs and increasing interest rates continued to be a cause of concern for the company. Tata would counter this impact with the launch of new vehicles during the year as well as expand its international business, which accounted for 18 percent of revenues in the year.

Managing director, Ravi Kant said that the company had missed its target of export share due to a non-availability of products and capacity. This has been addressed since Tata is entering new countries and opening new segments in its overseas business. This includes the launch of the new trucks, tippers and flat beds in South Africa. Tata has also launched the Ace sub-one tonne mini truck in Sri Lanka, while its operations in Thailand is to be kick-started in the third quarter of 2007.