Latest News

India's TVS Motor beats its quarterly profit forecast and seeks alternative rare-earth materials

TVS Motors, India's largest electric two-wheeler manufacturer by sales, beat its quarterly profit expectations on Thursday due to strong local sales and exports. It also said that it would seek alternatives for rare-earth magnetic materials in light of China’s export ban.

The company that also produces three-wheelers had previously flagged challenges with securing magnets which are crucial for electric motors.

China, which is the largest producer of rare earth magnets in the world, implemented export restrictions in April. Some shipments have resumed to the U.S., Europe and other countries. However, Indian companies are still waiting for Beijing's approval.

TVS will be looking for "HRA-free", cerite-based and magnet-free alternatives, which don't include heavy rare-earth elements, as well as alternative countries, said K N Radhakrishnan, the chief executive of TVS, in a conference call following its earnings.

Mahindra said it would use alternatives like light rare earths and ferrites.

TVS Motors' overall two-wheeler sale rose by 17%, to 1.2 million units, in the quarter that ended June 30. This was largely due to a growing share of premium models such as the Apache Series, which accounts for about 25% of the total revenue.

Exports, which account for nearly a quarter of the company's total revenue, increased by 39%.

Jupiter's scooter maker's profits jumped by 34.9% compared to a year ago, reaching 7.79 billion rupees (88.92 millions dollars) in the second quarter. This was higher than analysts' estimates of 7.63 billion, according to data compiled and analyzed by LSEG.

The revenue from operations increased by 20.4%, to 100.81 milliards of rupees. This is higher than analysts' estimates of 99.36 trillion rupees.

Analysts say TVS is moving towards a "richer mix of products," with high-margin models like bikes and scooters with high engine capacities gaining ground over entry-level versions.

This change helped to boost its core earnings, as the operating EBITDA increased from 11.5% in the previous year to 12.5% during the first quarter.

(source: Reuters)