Telco edged up 1.17% to Rs 185.80 early today as the latest figures show sales volumes have risen 67.9% in May 2003.

The scrip of India's largest commercial vehicles maker had touched an even higher Rs 187 barely as trading commenced . A total of 91,726 shares were registered as volumes in Telco on BSE by 10:05 IST.

In the 31 sessions between 24 April 2003 and 9 June 2003 , the scrip has risen from Rs 148.55 to Rs 183.65.

The scrip's early fortunes contrasted with that of the BSE Sensex, which was at 3,330.76, down 6.55 points.

For the month of May 2003, Mumbai-based Tata group commercial vehicles and car maker Telco reported an impressive 67.9% jump in total vehicle sales to 21,929 units.

The most impressive gains were recorded in the car segment, where the company's Indica sold 6,772 units compared to 2,995 units in May 2002. Its recently launched Indigo sold 1,983 units. Besides, 2,160 utility vehicles were also sold. Domestic sales of medium and heavy trucks and buses combined jumped 29.3% in the month to 6,389 units. Light commercial vehicles sales soared 55.3% to 3,411 units.

On a month-on-month basis, too, total sales improved 46.4% from 14,979 units in April 2003.

The numbers are being deemed better than what the market was expecting. The company, perhaps, benefited from delay in sales in April due to the 10 days truckers strike. This delayed buying was carried over in  May 2003. Analysts are bullish about growth prospects for the four-wheeler sector. For the Telco stock, with limited option to invest in the automobile sector, they feel players are likely to park their funds in Telco.

Late last month, Telco announced its Q4 and FY 2002-03 results.

For the fourth quarter ended 31 March 2003, the company posted a 15% fall in net profit to Rs 137.57 crore (Rs 161.68 crore) on a 16% increase in total income to Rs 2,997.92 crore (Rs 2,586.69 crore).

The fall in net profit was in line with a capitalmarket.com poll of six automobile analysts, which estimated Telco's net profit at between Rs 126 crore and Rs 150 crore for MQ 2003 compared to a net profit of Rs 161.68 crore in MQ 2002, a fall of 7% to 22%.

For the year ended 31 March 2003, the company staged a turnaround with a net profit of Rs 300.11 crore compared to a net loss of Rs 53.73 crore in the corresponding period of the previous year. Total income increased by 21% to Rs 9,111.26 crore from Rs 7,525.92 crore in FY 2001-02.

On a consolidated basis, for the year ended 31 March 2003, the Telco group's net profit works out to Rs 298.67 crore (loss Rs 107.19 crore) on a total income of Rs 9,627.92 crore (Rs 7,934.58 crore).

The Telco board has recommended a 40% (Rs 4 per share on a face value of Rs 10 ) dividend for FY 2002-03.

The company is expected to record a decent growth in the current fiscal. Earlier, aggressive cost-cutting and higher sales helped the company to bounce back into the black from two loss-making years.

The company posted a profit in the fourth quarter of the last fiscal, the fifth straight quarter of profit, after reporting losses in the preceding seven quarters.

Analysts feel Telco's fundamentals are strong. A buoyant export performance is also expected to help the company register impressive growth in the financial year ending 31 March 2004. Further growth is expected in the coming months due to the government's thrust on infrastructure projects, the boom in the replacement market and the shift in consumer preference from one-and two-axle vehicles to multiple-axle vehicles (in which Telco holds No. 1 position).

As a result of various initiatives taken by Telco to optimally capitalise on the opportunities before it, and its inherent strengths, the company said it is confident of maintaining the current growth tempo not only for the next two to three quarters, but also for the next few years.

In the current fiscal, analysts feel the company may achieve a growth of 7-8% in domestic commercial vehicle sales and a 25% surge in exports. In the car segment, they expect a 22.5% growth whereas the utility vehicles segment is expected to record a 25% drop.

As on 31 March 2003, promoters held a 32.21% stake in Telco, while the public, institutions and foreign bodies held 15.78%, 20.79% and 21.34%, respectively.