New Delhi: Tata Motors has seen its first quarter profit growth screech to a halt. Like other automakers, the company has suffered from rising raw material costs that have chewed into margins. Net profit inched ahead 0.5% to just under Rs 2,000 crore. That was on a revenue growth of 24% to Rs 33,572 crore. Things could get worse for Tata Motors. The company has a net debt of about Rs15,000 crore as of June. And sales of its wide range of cars went into reverse gear in July. The Nano car alone saw its sales drop a full 64% during the month. But shares of the firm made a modest gain of 0.2% on the BSE to 845.60 on a day overall markets fell.
Moving to the economy, new figures show India’s food inflation has hit a four-month high towards the end of July. The food price index hit 9.9% in the period to 30 July. The previous week it stood at just 8.04%. Rising prices of onions and other vegetables along with meat caused the latest spike in food inflation. Inflation remains high despite 11 rate hikes by the Reserve Bank since March of last year.
Indian markets returned to losses on Thursday after a one-day gain. Disappointing earnings results including that of Tata Motors were the main culprits. The Sensex dropped 71 points to 17,059. And the Nifty fell 23 to 5,138.