MUMBAI: Tata Motors, despite input and margin pressures, has reported an improved performance for 2005-06 on a consolidated basis with a 25 per cent increase in its net profit at Rs. 1,728 crore against Rs. 1,385 crore. The company's consolidated revenues (net of excise) were up 21 per cent at Rs. 23,718 crore (Rs. 19,533 crore). The company has declared a dividend of Rs. 13 per share.

The consolidated results include the results of the erstwhile Tata Finance, Telco Dadajee Dhackjee and Suryodaya Capital and Finance consequent to their merger into Tata Motors during the year. The company's operating profit was at Rs. 20,664.25 crore against Rs. 17,036.26 crore. The company provided Rs. 246 crore (Rs. 169.66 crore) towards interest charges, Rs. 623.31 crore (Rs. 531 crore) for depreciation and Rs. 640 crore (Rs 490.6 crore) for tax. The company produced 2.46 lakh commercial vehicles (2.10 lakh) and sold 2.15 lakh units (1.90 lakh), produced 2.10 lakh (1.91 lakh) passenger vehicles and utility vehicles and sold 1.89 lakh (1.79 lakh) units. Exports were higher at 50,223 units against 30,497 units. Commercial vehicle sales were the highest ever and the company's overall market share has improved to 61.3 per cent from 59.7 per cent. In passenger vehicles, the market share was maintained at 16.5 per cent.

Addressing the media here on Friday, Ravi Kant, Managing Director, Tata Motors, said, "The Indian commercial vehicles market grew by 10.1 per cent in 2005-06, largely because of Tata Motors' Ace. Without Ace, it would have grown by a mere 0.7 per cent.'' The company was in the process of ramping up the capacity for Ace from 30,000 units to 60,000 units annually and the expansion would be completed next month, Mr. Kant said.

The cost reduction exercise, in place for the last four years, helped the company to maintain its operating margins in spite of high input costs. As against the target of Rs. 300 crore in cost reduction during the year, the company reduced costs by Rs. 471 crore, he said.

"We have come to learn to live with volatility in steel prices. Over the last four years, we have been squeezing costs out of the system and that is why our margins have been maintained. But when steel prices decline, we will see a healthy impact on the bottomline.''

Speaking on the small car plant to come up in West Bengal, Mr. Kant said the cumulative capacity for small cars would, as earlier expected, be one million cars but West Bengal was only the first plant.

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