Tata Motors Passenger Vehicles (500570) Q4 98/99 earnings summary

Executive summary

• FY1998-99 was a difficult year: sales and other income fell to Rs.6,637.05 crore from Rs.7,362.79 crore; profit after tax declined to Rs.97.46 crore from Rs.294.66 crore.

• Tata Indica launched in December 1998 to a strong response, with over 1,15,000 initial orders backed by full payment; 2,166 cars were sold by year-end.

Financial highlights

• Profit before tax was Rs.107.16 crore, including Rs.102.38 crore profit on the construction equipment business sale; excluding this item, profit before tax was Rs.4.78 crore.

• Profit after tax was Rs.97.46 crore versus Rs.294.66 crore; tax for the year was Rs.9.70 crore versus Rs.33.00 crore.

• Proposed dividend was Rs.3 per share versus Rs.5.50; total dividend, including tax, was Rs.85.20 crore versus Rs.154.84 crore.

Outlook and guidance

• Early signs of market revival appeared in the first months of FY1999-2000, including a small recovery in commercial vehicles; sustainability remained uncertain.

• Indica assembly line began commercial operations in March 1999; feeder plants were still being calibrated, with production readiness expected to support demand in the current financial year.

• Euro II compliance for Indica was targeted before the end of FY1999-2000; other passenger vehicles were expected to be adapted for domestic production before the mandated deadline.