TVS Motor Q3 PAT seen up 8% at Rs 60.2 cr YoY

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TVS Motor Q3 PAT seen up 8% at Rs 60.2 cr YoY

TVS Motor is expected to report a profit after tax of Rs 60.2 crore in the third quarter of FY12, a growth of 8% as compared to Rs 55.7 crore in a year ago quarter.

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TVS Motor is expected to report a profit after tax of Rs 60.2 crore in the third quarter of FY12, a growth of 8% as compared to Rs 55.7 crore in a year ago quarter.

Revenues are seen going up by 6.3% to Rs 1,750 crore from Rs 1,646 crore year-on-year.

Operating profit margin is seen improving at 6.6% in the quarter ended December FY12 versus 6.1% in the corresponding quarter of last fiscal and 6.9% QoQ.

On quarter-on-quarter basis, revenues are likely to go down 12% and PAT is seen falling 21%.

Expectations
 
* Expect tepid growth in earnings due to lower dispatches in Q3 and adverse product mix (lower motorcycles, higher scooters; motorcycles now constitute 37% of volumes versus 40% QoQ )

* TVS Motor has underperformed the 2-wheeler sector in Q3 with only 1% YoY growth in volumes. (Bajaj Auto volume growth 13.6%, Hero Motocorp volume growth 11.3% YoY) 

* Alert: TVS Motor had hit record volumes in previous quarter

* Management had indicated that post November, dispatches slowed down considerably.

* Margins to decline QoQ led by an adverse product mix (more scooters, less motorcycles)

* However, raw material / sales to decline due to raw materail cost coming off, last quarter was at 75.5%
 
* Revenues growth to be tepid due to barely 1% growth in volumes YoY (down 12.6% QoQ) and 6% YoY growth in realisations
- Realisations to grow 6% YoY, 1.4% QoQ to Rs 33400/unit
- High depreciation and taxes to further impact profits
 
Volume

- Total volumes went up 1.1% (down 12.6% QoQ) at 5.29 lakh units versus 5.24 lakh units
- Motorcycles down 6.6% (down 19% QoQ) at 1.94 lakh units versus 2.08 lakh
- Scooters up 11.3% (down 13.6% QoQ) at 1.36 lakh units versus 1.22 lakh
- 3W down 11.5% (down 25% QoQ) at 8941 versus 10108 units
- Exports up 34% (down 14% QoQ) at 71752 versus 53513 units