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TVS Motor sets 15 % topline growth

Venu Srinivasan, CMD, TVS Motor Company

CHENNAI: TVS Motor Company has asserted that it is confident of hitting the 15 per cent topline growth target this year.

The assertion comes even as the Reserve Bank of India announced a further tightening of the monetary policy by squeezing liquidity in the system in a bid to contain the rising inflation. Venu Srinivasan, Chairman and Managing Director, told The Hindu that “TVS has factored in the low growth scenario while fixing the15 per cent topline growth target.” Mr. Srinivasan said that the projected topline number would come primarily from exports and sale of Flame and three-wheelers.

Asked if the latest measures by the RBI would trigger a recession, Mr. Srinivasan replied in the negative. He, however, felt that the GDP growth rate could drop below seven per cent. The manufacturing sector could also see low growth, he added. Given the high inflation and the low growth scenario, he said the RBI had sent out a strong message through its latest exercise. Mr. Srinivasan said that the result of these measures could show up on the inflation probably by March-April next year. “We do see some turbulence on the way,” he said. Nevertheless, he said that the company had already factored in these negatives while projecting a 15 per cent topline growth.

In an informal a press conference here on Monday, Mr. Srinivasan expressed optimism that TVS Motor would see a “positive free cash flow” this year. The company was hoping to improve its market share from 16 per cent to 18 per cent this year, he said.

Mr. Srinivasan indicated that TVS Motor would come out with a four-stroke three-wheeler by October.

Meanwhile, TVS Motor reported revenue of Rs. 924.74 crore for the quarter ended June 2008 compared to Rs. 801.56 crore recorded during corresponding quarter in the previous year. The profit before tax and the profit after tax during the quarter under review had been placed at Rs. 10.02 crore and Rs. 7.02 crore, respectively, as against Rs. 10.90 crore and Rs. 7.55 crore recorded in the corresponding period last year. The profit before tax had the benefit of exceptional credit (net) of Rs. 7.22 crore.

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