Tata Motors posts Rs.2,223 crore Q2 profit

MUMBAI - Tata Motors said Tuesday its second quarter profit increased to Rs.2,223 crore as compared to just Rs.22 crore in the same quarter last year, on higher sales and turnaround in Jaguar Land Rover business.

The company’s total revenue surged 36.5 percent to Rs.28,782 crore for the quarter ended Sep 30, 2010 from Rs.21,088 crore in the corresponding quarter of previous year.

The Jaguar Land Rover business continued to show strong profitability, with healthy volumes in the second quarter, reporting a profit after tax of Rs.1,715 crore, Tata Motors said in a statement here.

“Both wholesale and retail volumes improved favourably as compared to the corresponding quarter in the prior year on the back of improved market conditions,” it said.

The company has made a significant turnaround in the last one year. For the first six months of current fiscal Tata Motors has posted Rs.4,211.72 crore profit as against Rs.307 crore loss in the corresponding period last year.

The company’s South Korean commercial vehicles subsidiary Tata Daewoo Commercial Vehicles Co. Ltd, however, reported a decline of 8.5 percent in its net revenues, due to lower exports.

The financial subsidiary of the automotive major Tata Motors Finance Ltd.’s net profit increased to Rs.45 crore from Rs.21 crore.

On a standalone basis, Tata Motor’s net profit for the second quarter of the current fiscal year decline by 40.60 percent and stood at Rs.433 crore as against Rs.729 crore in the like period of last year.

“Cost pressure, supply chain bottlenecks resulted in a dip in the operating margins to 9.7 percent,” the statement said.

Last year, the company made an additional profit of Rs.370 crore by selling of its investments on which it was not liable to pay tax.

“Good macroeconomic conditions, good monsoons and good finance availability led to robust domestic demand during the quarter, resulting in volume growth across all segments,” the statement added.