MUMBAI (AFP) ― India’s top vehicle maker Tata Motors posted a 41 percent jump in quarterly net profit on Tuesday, beating forecasts, thanks to strong sales of its British luxury icons, Jaguar and Land Rover.
The company said its global operations, including Jaguar and Land Rover, showed a consolidated net profit of 34.06 billion rupees ($681 million) for the three months to the end of December, up from 24.2 billion rupees a year earlier.
“Our sales in United States have increased and its economy has stabilised,” Ralph Speth, chief executive of Jaguar and Land Rover, told reporters.
Speth said the company was cautiously optimistic about the United States and China, but added the same could not be said about Europe.
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Crowds stand in front of an advertisement for Tata Motors Ltd.’s Nano hatchback vehicle at the Auto Expo 2012 in New Delhi. (Bloomberg) |
The profit for the third financial quarter outpaced market forecasts of 26 billion rupees.
“The earnings are very good ― there is nothing to complain about,” analyst Mahantesh Sabarad of Mumbai brokerage Fortune Equity Brokers told AFP.
Revenues of Tata Motors, part of the giant steel-to-software Tata Group controlled by billionaire Ratan Tata, climbed 45 percent to 452 billion rupees for the quarter.
Earnings of India’s top vehicle maker by revenue were also buoyed by better domestic sales.
Indian sales of cars and sports-utility vehicles jumped 33 percent to 85,322 units. Local sales of trucks and buses climbed 15.5 percent to 131,220 units.
Rising disposable incomes and launches of new models have boosted Tata Motors’ domestic sales.
For the quarter to December, the Jaguar-Land Rover business had a profit of 440 million pounds ($692 million), surging 57 percent from 275 million pounds a year earlier, as demand for the prestige cars improved across key markets.
Tata Motors, which is also the maker of the world’s cheapest car, the Nano, bought Jaguar and Land Rover from U.S. Ford Motor Co. in 2008 for $2.3 billion as part of plans by Tata Motors to expand its reach beyond Asia.
The deal vaulted Tata Motors from a commercial vehicle and small-car maker to a global player with luxury brands in its range of offerings.
“Jaguar and Land Rover’s presence is spread evenly across the U.S., mainland Europe and China. It is also slowly increasing its foothold in Australia, South Africa, Brazil and India,” Fortune’s Sabarad added.
Tata Motor shares closed up 3.74 percent, or 9.65 rupees, to 267.9 rupees on the Bombay Stock Exchange, on the heels of the earnings announcement.
