TVS Holdings (520056) Q4 98/99 earnings summary

Executive summary

• FY ended 31 Mar 1999 delivered sales of Rs.15,999.94 lakh and profit after tax of Rs.1,582.83 lakh; the comparison period ended 31 Mar 1998 covered 10 months, limiting comparability.

• Recommended dividend of Rs.3 per share, or 30%, for FY 1998-99.

• Won the Deming Prize for company-wide quality control in Nov 1998, the first recipient in India and Asia.

Financial highlights

• Sales and other income were Rs.17,318.41 lakh vs Rs.13,937.25 lakh for the prior 10-month period; sales alone were Rs.15,999.94 lakh vs Rs.12,999.97 lakh.

• Profit before tax was Rs.2,107.83 lakh vs Rs.1,263.72 lakh; profit after tax was Rs.1,582.83 lakh vs Rs.975.72 lakh.

• Other income rose to Rs.1,318.47 lakh, including Rs.600 lakh in service-charge recoveries and Rs.524.68 lakh in gross dividends.

• Proposed dividend of Rs.569.03 lakh; Rs.1,050 lakh transferred to general reserve and Rs.653.21 lakh carried forward.

Outlook and guidance

• Q1 FY 1999-2000 commercial-vehicle sales rose 45% YoY; management expected ~10% growth in the segment for FY 1999-2000.

• Planned in-house alloying to reduce cost and improve quality; expected higher casting volumes for Tata Cummins, Hyundai and Ford India.

• Planned investment of ~Rs.27 crore in foundry capacity, manufacturing-process upgrades, quality improvements and infrastructure, funded from internal resources.