Tata Motors net up 26% on higher sales

Tata Motors today reported 26 per cent rise in net profit to a record Rs 576 crore for the quarter ended March this year, and 20 per cent rise in sales at Rs 8,267 crore, riding on the demand for the revamped Indica and Ace mini truck.

While the figures followed expectations, rising costs would pose an issue in the coming quarters, the company said.

The profits of the country's biggest manufacturer of commercial vehicles were pushed up by gains from the rising rupee, with its fourth quarter foreign exchange gains doubling to Rs 60.2 crore.

"The rising costs of raw materials and interest rates have continued to affect margins, and are expected to continue even this year," said Praveen Kadle, the company's executive director, finance. But the price tag on the cheap small car planned by the company would stay at Rs 1 lakh, the figure that has become the unofficial nomenclature of the vehicle, he told Bloomberg. The car is expected to hit the market by 2009. "There's pressure on keeping the cost down. But we will still sell the car at Rs 100,000," Kant said.

The net profit for the year ended March 31 this year rose 25 per cent to Rs 1,913 crore, while income from operations for the year grew 33.32 per cent to Rs 27,535.24 crore from Rs 20,653.49 crore in the previous year.

The company's board today appointed PM Telang, president (small and light commercial vehicles), as executive director (commercial vehicles).