TVS Motor falls short of Q4 profit expectations amid rising costs

TVS Motor Q4 earnings: TVS Motor Company reported lower-than-anticipated fourth-quarter profit on Wednesday, as increased expenses overshadowed the steady demand for its range of two-wheelers.

The renowned manufacturer of Jupiter scooters and Apache motorcycles revealed that its profit for the quarter ending March 31 surged by 18.3 per cent from the previous year to Rs 485 crore. However, this figure fell short of analysts' expectations, which were pegged at Rs 552 crore according to LSEG data.

Despite this, TVS Motor witnessed growth in revenue from operations, which soared by nearly 24 per cent to Rs 8,169 crore. This outperformed analysts' projections of Rs 8,008 crore.

However, the increase in revenue was offset by a notable rise in total expenses, which escalated by nearly 22 per cent. The surge was primarily driven by a more than 23 per cent increase in the cost of materials consumed. Analysts attributed this rise to the escalating costs of key input commodities for automakers, such as copper, rubber, and lead, during the fourth quarter.

Additionally, TVS Motor's tax expense witnessed an uptick of about 37 per cent to Rs 186 crore.

Despite the challenges posed by rising costs, the company's two-wheeler sales saw a robust growth of about 23 per cent to surpass a million units in the March quarter, with motorcycles accounting for almost half of these sales.

However, despite the positive sales performance, shares of TVS Motors have experienced a decline of 1.4 per cent so far this year. In contrast, peers Bajaj Auto and Hero MotoCorp have seen notable increases of 28.7 per cent and 12.1 per cent, respectively.

Both Bajaj Auto and Hero MotoCorp have reported stronger-than-expected quarterly profits for the fourth quarter, further highlighting the challenges faced by TVS Motor amidst the current market conditions.

(With Reuters inputs)