Even as foreign auto manufacturers are putting off their investment plans fearing the uncertain business environment regarding diesel, two Indian auto majors have reported impressive profits largely on account of domestic diesel sales.
Tata Motors, posted a three-fold rise in its consolidated net profit at Rs 5177.06 crore for the quarter ended March 31, driven largely by the strong performance of its British arm JLR and robust growth of its heavy and medium commercial vehicles. The company had posted a consolidated net profit of Rs 1716.5 crores in the same period last fiscal.
Net profit at Mahindra and Mahindra also surged by 13.95% to Rs 670 crore. This was on account of strong tractor sales and demand of its new utility vehicles.
Despite the prevailing uncertainty regarding diesel vehicles both the companies are going ahead with expansion plans. Mahindra has reiterated that it is not slowing down on any investment plans despite the diesel ban and has committed Rs 7,500 crore for the coming three years.
Says a Tata motors spokesperson: “Demand for new models, solid growth in Europe, the US and China for JLR has fuelled our consolidated revenues to grow by 19% Rs 80,684 crore.”
For Mahindra & Mahindra, a double-digit volume growth in tractors and utility vehicles, a first in 16 quarters, drove revenues by 13% to Rs 10,160 crore.
Mahindra & Mahindra numbers includes earnings from the standalone entity and Mahindra Vehicle Manufacturers Limited.
Pawan Goenka, ED of Mahindra & Mahindra, says, “FY16 was a year of product launches for the company and it has helped build market share in almost all businesses. Our financial performance has been healthy and robust and cost reduction and low commodity prices have helped the company.”
Goenka is however hopeful of a positive verdict from the Supreme Court when it takes up the matter after the vacation.
Source : BS Motoring