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* Luxury models lapped up by Chinese
* Q4 net profit surges 139 pct
* JLR accounts for more than 95 pct of Q4 profit
By Henry Foy
MUMBAI, May 29 Chinese demand for its luxury
Jaguar Land Rover (JLR) models propelled fourth-quarter net
profit at Tata Motors', capping a bumper year for the
China's boost to JLR's bottom line comes as global
automakers, hit by sluggish sales in established markets such as
Europe, shift their focus towards developing economies to drive
A one-off tax gain also contributed to Tata's 139 percent
quarterly profit leap, which came in spite of a lacklustre
performance at its core domestic business.
It also reported a rise in net profit to 135 billion rupees
($2.42 billion) for the year to March 31, from 92.7 billion the
JLR's growth in overseas markets - it sells imports in India
and recently began assembling some Land Rover models there - has
helped insulate Tata from a sluggish domestic car market which
grew just 2.2 percent in the last financial year.
The British luxury brands, which Tata bought for $2.3
billion in 2008, brought in more than 95 percent of its profit
in the quarter to March 31, as sales grew by 48 percent.
Tata is focusing on markets such as Russia and China, as its
domestic arm struggles with high costs and sluggish sales
"We see very strong growth in China. The demand for our
vehicles, especially the Range Rover and Range Rover Sport, is
very high. If the dynamic continues, China will be our number
two market," this financial year, JLR Chief Executive Ralf Speth
Tata will invest 2 billion pounds ($3.14 billion) in JLR
this financial year, up from 1.5 billion last year.
In March it finalised a joint venture with China's Chery
Automobile Co to make JLR vehicles in the world's
largest car market.
China accounted for 17.3 percent of JLR sales in the year to
end-March, its fourth-largest market. The UK - JLR's home market
- brought in 19.7 percent of sales while North America accounted
for 18.5 percent. Europe was its largest market at 22.8 percent.
Part of the software-to-hotels Tata Group, India's largest
business by revenue, Tata Motors said net profit for the fourth
quarter to end-March was 62.5 billion rupees ($1.13 billion), up
from 26.2 billion.
The figure was boosted by 217 million pounds ($340.6
million) in deferred tax assets.
Consolidated net profit, after accounting for minority
interest and share of associates, was 62.3 billion rupees.
Consolidated revenue rose 44 percent to 509 billion rupees, from
353 billion a year ago.
India's biggest truck manufacturer and the maker of the
Nano, dubbed the world's cheapest car, Tata sparked fears it had
bitten off more than it could chew when it bought the
loss-making JLR brands from Ford Motor Co, given its
minimal experience in international manufacturing and luxury
Yet the acquisition has fast overshadowed its parent.
Boosted by runaway demand for the Range Rover Evoque compact
SUV launched last year, JLR's revenue grew 51.5 percent to 4.14
billion pounds in the quarter to March.
The unit reported an operating profit margin of 14.6 percent
in the quarter, against 9.5 percent for the domestic business.
The local arm, India's biggest truck and bus maker, has
suffered as high interest rates and slowing economic growth
dampen demand in Asia's third-largest economy.
Investment in the domestic arm will be 30 billion rupees
this fiscal year, unchanged from last year, Tata Motors'
managing director, P.M. Telang, said.
Shares in the automaker, Tata Group's second-most valuable
listed company at $14 billion, have risen almost 48 percent in
2012 - quadruple the gains seen by the wider auto industry
- due to strong sales at the luxury brands.
Even so, the stock has slipped by about 10 percent since the
company announced flat global sales for April, with investors
worried the JLR sales boom may be subsiding.
($1 = 55.1800 Indian rupees)
($1 = 0.6368 British pounds)
(Editing by David Hulmes)