Daimler India Commercial Vehicle, the maker of Bharat Benz has broken into net profit for the first time in more than a decade and a half’s presence in the country.
The higher operating leverage thanks to strong offtake in the Indian market and sustained demand in the overseas market meant, the Chennai headquartered German truck maker posted a net profit of Rs 304 crore as against Rs 1 crore nominal loss, it had incurred in FY22.
The company had posted a net loss of Rs 421 crore in FY21.
A strong double-digit growth in volumes in FY23 helped Daimler India Commercial Vehicle post a revenue growth of 30% crossing the Rs 10,000 crore annual revenues mark.
The director’s note stated during the year FY23, under review, “The total revenue of the company increased to Rs 10,665 crore from Rs 8,217 crore in the previous year. Your Company made a profit of Rs 304 crore after tax as against a net loss after tax of Rs 1 crores in the previous year.”
Since its entry in 2012, Daimler India Commercial Vehicle has invested Rs 10,000 crore in India, its operations were broken even in FY18 and over the last three years the company had posted operating profit however on a net basis it was still in the red. This is for the time, the company ended a financial year with a net profit of Rs 304 crore.
This profit was made, after spending over a couple of hundred crores on R&D activities to cater to both Indian and overseas market products. Interestingly, over the last few years, the global capability centre has been extending services to global operations in Europe, Asia, Africa and Latin America and in the process is able to generate some revenues from within the group for services rendered.
A 100% subsidiary of Daimler Truck AG, Germany, DICV invested over Rs 225 crore towards Research & Development. Underlining that the company has become self-sufficient to meet its own future needs.
The annual filing sourced from Tofler stated that because of the R&D activities – DICV has derived benefits on multiple platforms (9-19t and 26-55t) – which are based out of Europe and Japan.
The R&D activities enlisted included “development and calibration of engines with increase in max. torque with the same power is completed. engine developed, vehicle integration and development is completed.”
DICV has already completed development and testing of High strength cabin, Load body, testing and evaluation for ABS in both, HDT & MDT and evaluation for the Disc Brakes, unitized bearing & alloy wheel in HDT.
The design and development of automated gearbox in HDT models and enhanced connectivity and information to customers on product performance are in progress, the report stated.
With capacities running at almost 100 percent, Daimler India is in the process of expanding the capacity at the factory.