TVS Motor Co, India's third largest two-wheeler maker, on Friday reported its net profit in Jan-March more than doubled, but its shares plunged as the earnings were way below market expectations.
"The results were below street estimates. Street was expecting quarterly profit around Rs 55 crores," said an auto analyst from a local brokerage who declined to be named.
"Raw material cost pressures have hit their margins. The outlook for the stock would remain neutral until the company improves on the margin front," he said.
Fourth quarter net profit rose to Rs 41.68 crore from Rs 202.93 crore and net sales to Rs 1,604 from Rs 1,192 billion, TVS Motor said in a statement earlier on Friday.
TVS Motor shares ended down 5.69% at Rs 56.35 in a Mumbai market that closed down 0.81%.
The company, which sells brands including TVS Apache and Scooty, has resorted to price increases to protect margins. Officials said TVS Motor had raised prices about 2% in April.
The firm's FY11 net profit increased to Rs 192 crore against Rs 88 crore in the previous financial year.
Total revenue grew to Rs 6,289 crore from Rs 4,430 crore.
TVS Motor also said its subsidiary in Indonesia was targeting markets outside the country and aims to increase its presence in more provinces.
