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TVS Motor Company reports 139 crore loss in Q1FY21

The company implemented several cost reduction steps, which translated into cutting down its total expenditure by a sizable 62% YoY during the June quarter. (Photo: Mint)Premium
The company implemented several cost reduction steps, which translated into cutting down its total expenditure by a sizable 62% YoY during the June quarter. (Photo: Mint)

The company’s standalone revenue from operations stood at 1,432 crore, down 68% YoY from 4,469 crore during the year-ago period. Sequentially over the March quarter, it’s revenue declined 59% QoQ from 3,481 crore

TVS Motor Company Ltd (TVS) has reported 139 crore loss in its standalone results for the June quarter due to covid-19 related disruptions. It had reported a profit of 142 crore during the year-ago period.

The company’s standalone revenue from operations stood at 1,432 crore, down 68% YoY from 4,469 crore during the year-ago period. Sequentially over the March quarter, it’s revenue declined 59% QoQ from 3,481 crore.

“This (June) quarter is not a representative quarter due to covid-19 related shut down for a major part of the quarter. Both production and sales were severely impacted during the quarter and therefore reflects what was an unprecedented situation," TVS Motor said in a statement Wednesday.

The company had resumed operations at its manufacturing units from the second week of May after observing shutdown for more than 45 days. As a result it saw sales sliding to less than one-third of the total volumes reported in June quarter last fiscal.

TVS Motor’s Q1FY21 sales stood at 2.67 lakh units as against 9.23 lakh units sold during the year-ago period.

The company implemented several cost reduction steps, which translated into cutting down its total expenditure by a sizable 62% YoY during the June quarter.

“The company initiated several measures to contain costs. Salary cost and other expenses excluding raw material cost, interest and depreciation declined from 755 crores in June quarter of FY20 to 394 crores in June quarter of FY21," it said in its investor presentation.

TVS Motor’s consolidated revenue from operations stood at 1,940 crore, down 61% YoY from 5,018 crore during the year-ago period. It’s consolidated loss for the June quarter is at 179 crore as against the consolidated profit of 146 crore from the year-ago period.

Automotive vehicles and parts contributed the lion’s share of 1,461 crore (down 68% YoY) to its consolidated revenues, followed by 462 crore (up 2% YoY) by its financial services arm and 34 crore (down 75% YoY) from its spares business during the June quarter.

KN Radhakrishnan, director and chief executive officer at TVS Motor said that July volumes have improved over June and is close to the pre-covid levels from the year-ago period.

“We have lean stock across our dealership channels and the retail offtake is very good. This combination helps us estimate that there will be good demand for two-wheelers in the months leading up to the festive season," Radhakrishnan said.

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