Mumbai, Jun 30 (UNI) South India-based auto major TVS Motor Company today reported a lower revenue of Rs 3,291 crore for fiscal 2008 as against Rs 3,920 crore earned the previous year.
The company's net profit was also reduced by more than half at Rs 31.77 crore as against Rs 66.6 crore recorded in 2006-07.
The company in a year said the year, however, had been an eventful year with TVS completing its product portfolio with the launch of 'TVS Flame' in the executive segment. It also entered the three-wheeler segment with the launch of 'TVS King'. The year marked the commencement of commercial production from its Nalagarh Plant located in Himachal Pradesh.
The company also crossed another important milestone with the commencement of commercial production at its state-of-the-art plant located at Karawang near Jakarta, Indonesia and the successful launch of 'TVS Neo', the bebek, (exclusively developed for the Indonesian market) by its subsidiary PT TVS Motor Company.
With the various initiatives and a complete portfolio in two wheelers, the company is now in a better position to reverse the declining trend in sales and to report improved results, the release said.
The company said 2007-08 witnessed a five per cent decline in the two-wheeler industry consequent to restricted availability of retail finance, high interest rates and stringent norms exercised by financiers. The economy segment of the motorcycle category was severely hit and suffered maximum decline of 19 per cent.
During the year ended March 2008, while the company recorded overall two-wheeler sales of 12.77 lakh units, motorcycles recorded sales of 6.10 lakh units compared to 9.23 lakh units over the previous period. Till the launch of the TVS Flame towards the end of the year, the company was absent in the executive segment, which accounts for over fifty per cent of the motorcycle market.
TVS Motor Company's motorcycle portfolio was largely dependent on the entry level 'StaR' range of products and non-availability of retail finance had a severe impact on sales.
The company, commenting on the future performance, said the high inflation and restricted availability of retail finance would continue to affect the prospects of the two-wheeler industry.
However, the company will have the benefit of all the new products launched towards the end of 2007-08. This will help the company to reverse the declining trend in sales and to report improved results.
The company can also leverage the capacity created at its HP plant and its entry into the three-wheeler industry.
UNI VK SSS VKG1810