Chennai floods slow down TVS Motors' growth, reports 19.43% profit

Chennai based TVS Motors announced its third quarter results on Friday. The rise in profits of 19.43 per cent missed the analyst expectations, as the company's business was dampened by Chennai floods; and provisions for bonus.

On financial front, the consolidated net revenue from operations of TVS reached Rs 2940 crores in Q3FY16 compared to Rs 2653 crores in Q3FY15, an increase of 10.81 per cent year on year (YoY). The EBITDA stands at Rs 202 crores this quarter compared to Rs 160 crores in Q3FY15, an increase of 26.25 per cent YoY. The EBITDA margin of company stands at 6.88 per cent this quarter compared to 6.04 per cent in Q3FY15. The substantial increase in EBITDA is  attributed to slow increase in raw material consumption which increased by just 3.83 per cent YoY to Rs 2022 crores this quarter, compared to Rs 1947 crores for the same period last year. The net profit stands at Rs 108 crores in Q3FY16 compared to Rs 90.18 crores in Q3FY15, an increase of 19.43 per cent YoY.

The nine month ending consolidated net revenue from operations increased by 10.92 per cent and reached Rs 8429 crores compared to Rs 7599 crores for the same period last year. The net profit for nine month period stands at Rs 314 crores compared to Rs 257 crores, an increase of 22.17 per cent for the same period last year. Volume wise the company sold a total of 20,18,795 vehicles in April-December 2015 period, showing a growth of 5.37 per cent from 19,15,823 vehicles in same period last year.

Volume wise, the company sold a total of 7,02,044 vehicles in Q3, a growth of 7.08 per cent from 6,55,571 vehicles in the same period last year. Exports almost remained flat with 108,000 units being exported in the quarter compared to 107,000 units in the corresponding quarter of the previous year.

This quarter the company contributed to the flood relief fund of Government of Tamil Nadu. The reported profits are post the provision for one off expense of Rs 7.5 Crores consequent to floods in Chennai; and a further sum of Rs 10.6 Crores was provided on account of retrospective amendment to Bonus Act. Out of this amount a sum of Rs 5.7 Crores relating to 2014-15 has been shown as exceptional item.

The Board at its meeting held on 29th January 2016 declared an interim dividend of Re. 1 per share (100%) for the year 2015-16, absorbing a sum of Rs. 55.65 Crores, including dividend distribution tax.