TVS Motor Jan-March profit slips 5% on lower volume

Two-wheeler maker TVS Motor Company today reported a 5% fall in standalone net profit for the January-March quarter to Rs 275 crore as a low-single-digit rise in sales was not enough to cover the rise in costs.

Revenue from operations grew 4% to Rs 5,530 crore, mainly due to price hikes as the company's total sales volume declined during the quarter.

The overall two-wheeler and three-wheeler sales, including exports, fell to 8.56 lakh units from 9.27 lakh units in the quarter ended March 2021.

However, for the fiscal 2021-22, TVS Motor's earnings showed a much better picture with the company recording its highest ever turnover and profit.

During 2021-22, revenue from operations grew 24% to Rs 20,791 crore and profit after tax rose 46% to Rs 894 crore.

"This highest turnover of the company in a financial year was achieved under very challenging condition of COVID-19 wave 2 & 3, semiconductor shortage, container availability constraints and steep increases in the commodity cost," the company said.

In volume terms, the overall two and three-wheeler sales, including international business, grew 8% to 33.10 lakh units in 2021-22.

Other key highlights

1) The board declared the interim dividend of Rs. 3.75 per share for 2021-22.

2) In the international business front, two-wheeler sales hit record high figure of 1.09 million units in 2021-22.

3) Operating profit grew to Rs 557 crore during the March quarter from Rs 536 crore a year ago.

4) The company re-appointed Sudarshan Venu as Managing Director for five more years.

5) Operating EBITDA margin for the year expanded to 9.4% from 8.5% in the previous year.

6) During the year, the company incurred Rs 30 crore towards COVID-19 related expenses.