Tata Motors posts FY10 net profit, beats forecast,plans to invest Rs3,000 crore,recommended dividend of Rs. 15 per share

Tata Motors posts FY10 net profit, beats forecast,plans to invest Rs3,000 crore,recommended dividend of Rs. 15 per share

Tata Motors : India's largest vehicle maker, returned to an annual net profit, beating forecasts on rising sales and improved profitability of its Jaguar and Land Rover unit.

The board of Tata Motors in its meeting on 27 May 2010 has recommended dividend at the rate of Rs. 15 per share for the financial year 2009-10 and a dividend at the rate of Rs. 15.50 per share on 'A' ordinary shares.

The company, India's largest truck and bus maker, reported a consolidated net profit of 25.71 billion rupees ($544 million) for its financial year ended March.

In the previous year, it had reported a net loss of 25.05 billion rupees, its first annual loss in eight years.“Overall economic recovery, a benign liquidity environment along with government stimulus has driven domestic demand revival,” the company said in a statement.

“The company has planned several new products launches in the near future to defend and improve its market position.”

Tata Motors, whose products include the ultra-cheap car Nano, had reported global sales in the quarter ended March rose 66% to 275,194 vehicles, nearly a third of the total sales for the year.

The other income during FY 10 includes profit of Rs 1,801.12 crore on sale of its investments including divestment in Telco Construction Equipment Company to Hitachi Construction.

Volume recovery led by introduction of new products and strong continued growth in the existing portfolio, continued focus on cost efficiencies and price increases undertaken by the company to combat strengthening commodity prices aided the company to grow realizations and deliver double digit operating margin of 11.74 per cent.

During the year, the company launched and started sales of the Prima range of globally benchmarked heavy trucks. Passenger vehicles, including Fiat and Jaguar and Land Rover vehicles distributed in India grew by 25.3 per cent in the domestic market to 260,020 units.

The market share for Tata passenger vehicles for the period stood at 12.4 per cent. The company also ramped up the production of the Nano at the plant in Uttarakhand, and delivered 30,763 units of Nano during the year. Along with Fiat, the company has a joint market share of 13.7 per cent in the industry.