Mumbai: Strong sales of Jaguar and Land Rover (JLR) models helped Tata Motors Ltd, India’s largest auto maker by revenue, turn in consolidated profits for the year to 31 March, against a loss in the previous fiscal.
The company credited the introduction of new models and restructuring initiatives underway at its UK-based subsidiary for the profits.
Tata Motors reported a net profit of Rs2,571 crore for 2009-10, against a loss of Rs2,505 crore in 2008-09. Income went up 30% to Rs92,519.25 crore, compared with Rs70,880.95 crore the previous year. JLR operations contributed Rs49,300 crore to the income in 2009-10.
Tata Motors acquired the JLR business in June 2008. It despatched 193,982 JLR units to dealers from between June 2009 and March, compared with 167,348 units in the year-ago period.
Earnings from domestic operations were boosted by a growing contribution of trucks and buses in overall sales. Truck and bus sales rose 41% to 373,842 units over the previous year.
New passenger car models, including Fiat and JLR, propped up sales in the segment by 25% to 260,020 units.
Boosting earnings: (from left) Carl-Peter Forster, group CEO of Tata Motors; Ravi Kant, vice-chairman of Tata Motors; and Ralph Speth, head of JLR, present the firm’s financial results in Mumbai. Rupak De Chowdhuri/Reuters
Ajay Sethia, analyst at Centrum Broking Pvt Ltd, said the company’s earnings are in line with expectations. But he cautioned that “maintaining volumes could be a big challenge” as JLR earns two-thirds of its revenue from Europe, which is facing a financial turmoil.
Changes in environment regulations in some key markets of JLR is another concern.
Carl-Peter Forster, group chief executive at Tata Motors, said the European crisis won’t have an immediate impact on JLR sales as it has a healthy order book.
Forster also said he expected the economic recovery in the US and China to offset the slowing European demand. JLR sold 25,000 models in China in 2009-10. “We plan to broaden our foothold in China,” Forster said.