India's TVS Motor misses quarterly profit view on labour-code charge despite demand surge

TVS Motor

28/01/2026 09:09

Jan 28 (Reuters) - TVS Motor TVSM.NS reported a lower-than-expected quarterly profit on Wednesday after taking a one-time charge linked to India's new labour codes, although strong two-wheeler demand and export growth boosted sales.

Profit jumped 52% to 9.4 billion rupees ($102.47 million) for the quarter ending December 31, from 6.18 billion rupees a year earlier. However, it came in below analysts' expectations of 9.8 billion rupees, per data compiled by LSEG.

The company booked a 413.7‑million‑rupee charge due to India’s new labour codes implemented in November last year, denting its profit.

The Jupiter scooter maker's revenue rose 37% to 124.76 billion rupees ($1.36 billion) in the quarter, beating analysts' estimate of 122.89 billion rupees, sending shares up as much as 3.4%.

TVS Motor's shares were down 1.4% ahead of the results.

The rollout of new tax reforms last year improved affordability and boosted disposable income, fuelling demand for two‑wheeler sales in the country.

India slashed taxes on two-wheelers with engine capacities of up to 350cc to 18% from 28%, which covers most of TVS’ lineup.

The tax cuts, coupled with festive buying, propelled domestic two-wheeler sales to around 5.7 million units, a record figure for the third-quarter.

TVS' overall two‑wheeler and three-wheeler sales rose 27% in the quarter, while two-wheeler sales in international business grew 35%, the company said in a press release.

The company's domestic two-wheeler sales alone grew almost 23%, ahead of the industry's 16.9% expansion.

The Apache maker's operating earnings before interest, taxes, depreciation and amortization margin rose to 13.1% from 11.9%, which analysts said was driven by sale of more profitable vehicles and favourable forex.

Rivals Bajaj Auto BAJA.NS and Hero MotoCorp HROM.NS will report quarterly results on January 30 and February 5, respectively.

($1 = 91.7350 Indian rupees)

 (Reporting by Meenakshi Maidas, Nandan Mandayam and Surbhi Misra in Bengaluru; Editing by Eileen Soreng)

 ((Meenakshi.Maidas@thomsonreuters.com; +91 8921483410;))