Tata Motors net plummets 153 percentJanuary 30th, 2009 - 9:10 pm ICT by IANS
New Delhi, Jan 30 (IANS) The country’s third largest passenger car maker and the biggest commercial vehicle manufacturer, Tata Motors, Friday said it posted a net loss of Rs.2.6 billion (Rs.263.26 crore/$58.5 million) in the third quarter of 2008-09, down 153 percent from that posted in the corresponding period last fiscal.The automaker incurred an operating loss of Rs.1.23 billion during the period against a profit of Rs.6.37 billion in the corresponding quarter last fiscal.
“The automotive sector in India suffered severe contraction in demand, arising from major financial and other market upheavals. This exacerbated the lack of liquidity and unavailability of consumer finance,” the company said in a statement.
Tata Motors sold 98,760 vehicles during the quarter, reflecting a drop of nearly 32 percent from the 144,608 units sold in the corresponding quarter last year.
Unaudited results showed the company was plagued by higher operating costs, with the dip in sales revenue exceeding the fall in expenditure by over 8 percent. The loss due to revaluation of foreign exchange borrowing stood at Rs.2.27 billion.
“The contraction in freight movement in many segments of the industry led to a massive drop of 61 percent in the M&HCV (medium and heavy commercial vehicle) segment demand,” the company said.
The sale of its stake in Tata Teleservices for Rs.478 million was reflected in the balance sheet for the quarter.
The company, however, did not make any provisions for expected loss due to relocation of its small car facility from Singur in West Bengal to Sanand in Gujrat.
“Based on the management’s assessment of the cost and benefits in connection with the relocation of the project from Singur to Sanand, and pending a detailed evaluation of the options relating to Singur facility, no provision is considered to the carrying cost of capital work in progress,” the company stated in the balance sheet.