CHENNAI (Reuters) – TVS Motor Co Ltd reported a near-50% jump in quarterly profit on Thursday, as people bought more of its scooters and electric two-wheelers even after Indian manufacturers raised product prices.
The company’s profit climbed to 4.1 billion rupees ($50.17 million) for the quarter ended March 31, from 2.75 billion rupees, a year earlier. Analysts said higher prices helped drive its profits.
Corporate India ranging from Maggi instant noodles-maker Nestle India and two wheeler-seller Bajaj Auto raised product prices in recent quarters as costs shot up in the aftermath of the Russia-Ukraine war.
Commodity prices are coming off their highs, but several companies, including Dove soap-maker Hindustan Unilever, have signalled more price hikes although the degree would ease from here.
Despite higher prices, consumers in rural areas are also beginning to upgrade their two-wheelers after lacklustre demand over the last year, with economic activity picking up.
TVS, known for its Jupiter two-wheeler, said scooter sales for the quarter increased 30% to 340,000 vehicles, while electric vehicles sales came in at 43,000 units, up from 6,000 units a year earlier.
The company’s revenue from operations rose nearly 19% to 66.05 billion rupees in the fourth quarter.
Rival Hero MotoCorp reported a bigger-than-expected rise in earnings on higher domestic demand earlier in the day. Bajaj Auto, meanwhile, reported a near-3% drop in quarterly profit last week dragged by sluggish exports.
Shares in TVS closed 1% higher on Thursday before it reported earnings, taking their gains so far this year to nearly 8%.
($1 = 81.7250 Indian rupees)
(Reporting by Praveen Paramasivam in Chennai; editing by Eileen Soreng)