>> Saturday, May 30, 2009
May 29 Tata Motors has reported a 10 per cent growth in net profit at Rs 591 crore for the quarter ending March 31, 2009 as against Rs 536 crore in the corresponding period last year. Net income dropped 21 per cent to Rs 6,895 crore (Rs 8,750 crore).
Net profit for the fiscal fell 51 per cent to Rs 1,001.26 crore (Rs 2,028.92 crore) while revenue was down 11 per cent to Rs 25,660.79 crore (Rs 28,739.41 crore).
High input costs and interest rates in the first half of the fiscal coupled with tight liquidity and low consumer sentiments in the latter half impacted margins, said Mr C. Ramakrishnan, Chief Financial Officer, at a press conference here on Friday. Tata Motors’ overall vehicle sales dropped 13 per cent to 5.06 lakh units (5.85 lakh units).
The company, however, improved its performance from the third quarter ending December 2008 when it reported a Rs 262-crore loss. “The October-December quarter was bad but each successive month turned out to be better. Barring heavy commercial vehicles, all segments have sprung back,” said Mr Ravi Kant, Managing Director, Tata Motors.Capex cut
Mr Ramakrishnan said the company would go in for a substantial capital expenditure cut in the medium term. “Given our wide product portfolio, we have a capex plan of Rs 10,000 crore for 2-3 years. We are planning a cutback of about Rs 2,500 crore. Our product development plan will go on and the cutback will mainly be in capacity expansion,” he added.
The capex last fiscal was around Rs 4,000 crore and is expected to be in the range of Rs 3,000-3,500 crore in the next couple of years. Besides this, Tata Motors plans a cost reduction of Rs 1,000 crore for the next three years.
The board has recommended a dividend of Rs 6 on ordinary share and Rs 6.50 on “A” share. The company’s shares closed 1.20 per cent up on the NSE at Rs 336.85.New MD
Mr Prakash M. Telang (61) is the new Managing Director of Tata Motors. He takes over from Mr Ravi Kant who steps down on June 1. Mr Kant will, however, continue as non-executive Vice-Chairman.
Source - Hindu Business Line.