Tata Motors Passenger Vehicles (500570) Q4 01/02 earnings summary

Executive summary

• FY 2001-02 revenue rose 9% to ₹8,918.06 crore; operating profit increased 80% to ₹740.09 crore, while net loss narrowed to ₹53.73 crore from ₹500.34 crore.

• Turnaround measures lifted operating margin to 8.3% from 5.1%; Q4 posted PAT of ₹161.68 crore, the first quarterly profit after seven loss-making quarters.

• Indica became the largest-selling model in its compact segment, while commercial vehicle share improved overall and in medium/heavy trucks.

Financial highlights

• Sales and other income increased to ₹8,918.06 crore from ₹8,164.22 crore; net sales/income from operations reached ₹8,894.80 crore versus ₹8,077.81 crore.

• Operating profit rose to ₹740.09 crore from ₹411.46 crore; profit before interest, depreciation and amortisation increased to ₹763.35 crore from ₹497.87 crore.

• Loss before extraordinary items improved to ₹63.39 crore from ₹430.44 crore; reported loss before tax was ₹109.21 crore versus ₹500.34 crore.

• Net loss was ₹53.73 crore after a ₹55.48 crore deferred-tax credit; FY 2000-01 net loss was ₹500.34 crore.

• Cost reductions totalled ₹332 crore in FY 2001-02 and ~₹630 crore over two years; cash generated from operations was ₹864 crore versus ₹688 crore.

Outlook and guidance

• Return to profitability was expected in FY 2002-03, supported by continued operating-efficiency and market-penetration initiatives.

• Infrastructure activity, including highway and housing construction, could support demand; higher fuel prices and border tensions were identified as potential offsets.

• New commercial vehicles were expected to upgrade the range; Indica variants were planned for selected European, Iranian and Latin American markets.

• Sedan on the Indica platform was planned for launch in H2 FY 2002-03; the Indiva MPV was also unveiled.