Falling margins at Jaguar Land Rover (JLR), higher capital expenditure and losses in the domestic business led Tata Motors to post the first drop in net profit in the past five quarters. Falling short of Street estimates, the company?s consolidated net profit more than halved in the October-December quarter at R1,627.50 crore. A Bloomberg poll had estimated the net profit at R2,890 crore. Net sales during the period were up 1.37% to R45,821.31 crore against R45,199.29 crore during the year-ago period.
JLR now plans to spend ?2.75 billion a year on its plants and product pipeline, up from the current ?2 billion a year as it charts its growth and looks to stem margin declines, Tata Motors managing director Karl Slym said. Rising investment, however, is eroding the British carmaker?s cash pile and raising the prospect of fresh borrowings that could hit its parent?s healthy debt position.
The unit?s cash was the chief factor driving an improvement in Tata Motors? consolidated net adjusted debt to operating Ebitda ratio to 0.98 in the year to last March from 1.21 in the previous year, ratings agency Fitch said in a recent note. JLR issued a $500-million bond in January and could look at raising more debt to finance its capex.
Tata Motors? domestic business, manufacturing trucks, buses and passenger cars, posted a loss of R458.49 crore Q3 against a profit of R174 crore. Total income for the domestic business fell 20.30% to R10,630 crore. Meanwhile, the operating margin for the India business also plummeted to 2.2% from 6.7% in Q3 last year.
Aditya Birla Nuvo net rises 28%
Aditya Birla Nuvo posted a 28% increase in consolidated net profit to R323.21 crore for the third quarter ended December 31 from R252.39 crore in the corresponding period last year, helped by strong growth at its financial services business. The company, whose portfolio extends from manufacturing to fertilisers and retail, clocked in net sales of R6,234.74 crore, which is a 10% rise from R5,658.17 crore in the year-ago period.
At the end of the third quarter, the company?s debt stood at R10,569 crore, from R10,006 crore in the quarter ended September 30. Assets under management of Aditya Birla Financial Services surged 26% to R106,950 crore at the end of the quarter. At the end of September, it stood at R101, 588 crore. Earnings before tax soared by 57% to R215 crore. Profit at the company?s life insurance business rose 56% to R159.8 crore. Managing director Rakesh Jain said, going forward, the company will increase product offerings, while managing costs at the life insurance business.
Dr Reddy?s posts 29% dip in Q3 net
Dr Reddy?s Laboratories has reported a 29.2% drop in its consolidated net profit to R363.31 crore for the third quarter from R512.96 crore in the corresponding period last year. The company attributed the drop in profit to declining sales of generics, especially in Europe. Its consolidated net sales increased only 3.5% to R2,865 crore from R2,769 crore. The earnings per share (EPS) declined to R21.39 from R30.26. On a standalone basis, net profit rose over three-fold to R346.64 crore for the third quarter against R108.03 crore in the year-ago period.
According to Saumen Chakraborty, president & CFO, the sales in Europe declined sharply by 20% to R193 crore from R242.6 crore. However, its sales in Russia and other CIS countries improved by 35% to R438 crore from R331.7 crore. In the domestic market, revenues improved by 12%, clocking R372 crore from R333 crore. ?Sales have declined by 20% in Europe as the markets is moving towards tender-based commodities, which makes the business tough. So, we will be revisiting strategy for the European markets and make it more attractive,?? he said, adding that the company is looking at various opportunities. The sales of global generics declined 2.2% to R2,083 crore from R2,129 crore. The generic sales in the US declined by 16.8% to R924 crore from R1,111 crore in the same quarter last year. The growth was driven by increased traction in key products like fondaparinux and tacrolimus.
HDIL net declines 31% to R107 cr
Mumbai-based real estate company Housing Development and Infrastructure?s (HDIL) consolidated net profit declined by a sharp 31% to about R107 crore for the quarter ended December 31 against around R156 crore in the year-ago period, due to marginal decrease in total income, whereas finance costs and tax expenses shot up. The group?s consolidated total income in the third quarter fell by a marginal 1.5% to around R432 crore against R438.5 crore last year. However, the company?s finance costs surged by a whopping 27.5% to R204 crore against R160 crore last year. The finance cost is significantly higher from quarter ended September 30 as well, which was about R154 crore.
The company said it will focus on execution and delivery of existing projects, and also launch new projects, which will aid in debt reduction. HDIL?s consolidated net debt increased to R3,920.14 crore against R3,801.5 crore in the second quarter of 2012-2013.
GVK Power Q3 net loss widens
GVK Power and Infrastructure (GVKPIL) has reported a consolidated net loss of R57 crore in the December quarter against a net loss of R14.50 crore recorded during the corresponding quarter last year. The loss was attributed to the restricted supply of gas for power projects, as a result of which the plants did not operate at full capacity, interest cost and write-off of receivables, the company said. Net sales declined by nearly 13% to R648.68 crore during the quarter as revenues from the power segment were down over 42% to R237.09 crore. The company reported net sales of R744.55 crore. The Ebidta margins at a consolidated level for the quarter stood at R242.54 crore against R218.55 crore, an increase of 11%.
The three gas-based projects in its energy segment have recorded a revenue of R237.08 crore against R411.57 crore in the same quarter last year.
In the transportation segment, GVK Jaipur Expressway Private recorded a revenue of R64.21 crore against R58.79 crore, an increase of 9 %. Traffic increased by 3% over the same period. In the airports vertical, while Mumbai International Airport (MIAL) recorded a revenue of R347.39 crore against R332.49 crore, an increase of 4%; Bangalore International Airport (BIAL) recorded a revenue of R153.07 crore against R153.26 crore.
Shipping Corp posts R75-cr loss
Shipping Corporation of India (SCI) posted a net loss of?R75.28 crore for the third quarter against a net profit of?R74.10 crore in the year-ago period, suggesting the turmoil in the shipping industry is far from over. The company had a foreign exchange loss of R254.8 crore on cost of vessels. Total income fell 22% to?R1,031.68 crore from?R1,322.58 crore last year as low freight rates and a slump in demand in the sector continued to cripple the company.
The bulk cargo transportation segment reported a net loss of?R110.4 crore against a net profit of R137.6 crore in the corresponding period last year. However, the liner division posted a net profit of R14.10 crore against a net loss of R24.10 crore.
India Cements Q3 net dips 54%
India Cements (ICL) has reported a 54% drop in its net profit for the quarter ended December 31 to R26 crore against R56 crore during the same quarter last fiscal. The Ebitda margin during the quarter more or less maintained at 18% to R196 crore. The total income jumped 15% to R1,086 crore during the quarter compared to R946 crore. The sharp drop in the net profit has been due to a R100 fall in net realisation per tonne, coupled with a fall in prices in Andhra Pradesh, said N Srinivasan, vice-chairman and MD. He said: ?We have made a decent performance. This is despite the fact that the Andhra Pradesh market witnessed a sharp drop in prices from R270 a bag to R210, coupled with a 25% y-o-y increase in freight & handling costs.
Following a decent distribution over a period of time coupled with the booming economic activities in the state, India Cements may consider putting up a plant in Gujarat or adding a second line at its Mahi plant in Rajasthan. ?While expansion is an option at Rajasthan, the company may even consider setting up a new plant in Gujarat, where we have been doing decent business over a period of time. Given our huge limestone deposit in Rajasthan, we are examining all options whether we can add a new line in our existing plant at Mahi,? Srinivasan said.
Suzlon sees massive loss
A steep rise in finance costs and significant drop in sales in the Indian market because of funds constraints sent Suzlon Energy hurtling down to a massive loss of R1,154.53 crore on a turnover of R 4,014.66 crore for the third quarter. The loss-making streak continues with the R1,154.53-crore loss, which was a 257% rise in losses compared to FY12Q3 loss, which was to the tune of R286.46 crore. Suzlon also saw its income go down 20.84% to R4014.66. The company blamed the fall in income to the drop in sales volumes because of fund shortage. Chairman Tulsi Tanti said operating performance was negatively impacted by liquidity constraints. But the approval of the CDR package would be a catalyst towards normalising operations, he said.
