Mumbai, Oct. 29: Tata Motors Ltd, the country’s largest automobile manufacturer, has been able to clock a massive growth in net profit for the second quarter ended September 30, primarily due to rise in truck sales and a steady shift in favour of multi-axle trucks. The company’s net profit rose 252 per cent to Rs 207 crore in the reporting quarter from Rs 58.8 crore registered in the year-ago period.
Analysts attribute part of the credit of Tata Motors’ zooming numbers to some recent measures, including a cut in excise duties and declining interest rates that fund automobile purchases.
Net sales rose 46 per cent to Rs 3,763 crore during the period under review, while other income was up at Rs 27.76 crore from Rs 3.99 crore year-on-year.
However, the firm’s growth in operating profit margin has stagnated. Many analysts track this figure minutely as it reflects the efficiency of the company. Analysts say it is up by a mere 13.82 per cent from 13.26 per cent in the preceding quarter.
Tata Motors’ growing volumes, on the other hand, has impressed analysts, who expect it to continue in the coming months. “The demand for trucks and buses perk up when the economy performs well,” an analyst tracking the segment said.
What is creditworthy for the auto maker is that it has outpaced industry growth. During the reporting period its sales of trucks and buses jumped 57 per cent from a year ago to 40,225 units, outpacing industry growth of 42 per cent. Tata Motors is the world’s fifth largest maker of commercial vehicles.
During the same period, sales of cars and utility vehicles rose 29 per cent to 37,903 units, while the rest of the industry clocked 23 per cent sales.
During the quarter, export sales volume increased by 58.8 per cent to 3,844 units, while sales realisation increased by 6.1 per cent. Part of the profits came from other income, which increased exponentially by 470.9 per cent to Rs 22.78 crore.