Tata Motors Passenger Vehicles (500570) Q4 04/05 earnings summary

Executive summary

• FY04-05 delivered record performance: vehicle sales rose 27.1% to 399,566 units; revenue reached Rs.20,648.66 crore and standalone PAT Rs.1,236.95 crore, up 52.6% YoY.

• Domestic market share strengthened to 59.7% in commercial vehicles and 16.9% in passenger vehicles; exports rose 38.3% by volume.

Financial highlights

• Standalone net revenue, excluding excise, rose 32.4% to Rs.17,585.22 crore; operating profit increased 15% to Rs.2,171.09 crore.

• Standalone PBT increased 27.8% to Rs.1,651.90 crore; PAT rose 52.6% to Rs.1,236.95 crore, versus Rs.810.34 crore in FY03-04.

• Consolidated net revenue grew 40% to Rs.19,532.84 crore; consolidated PBT was Rs.1,848.09 crore and PAT Rs.1,385.34 crore, up 51% YoY.

• Standalone sales volume was 399,566 vehicles, up 27.1%; turnover was Rs.20,648.66 crore, around 33% higher YoY.

Outlook and guidance

• Commercial vehicle growth was expected to moderate further in FY05-06 after two years of slowing growth; passenger vehicle growth was also expected to ease while remaining comparatively strong.

• Steel and rubber cost pressure, higher diesel prices, emission-rule changes and supply-chain certification constraints could weigh on FY05-06 profitability and sales.

• New products, road infrastructure development, rising personal mobility and export-market expansion were identified as longer-term growth opportunities.

• A small, affordable car and the Tata Ace mini truck were positioned to address lower-priced customer segments; product launches were expected to support future market presence.