TVS Motor Co. Ltd shares skid as much as 6.6% in intra-day trade on Tuesday after the two-wheeler company said that the coronavirus outbreak may lead to a 10% drop in its planned production for February 2020.
TVS Motor shares hit a low of Rs 409.45 in early trade on Tuesday in reaction to the company’s statement made after market hours on Monday. But the stock later pared much of its losses to trade 1.7% lower at Rs 431 apiece at 11:55 am.
The novel coronavirus (COVID-19) pandemic has led to an impact on the supply of certain components for the production of BS-VI vehicles, the company announced after market hours on Monday. “While TVS Motor’s direct dependency on China is limited for components, some tier II suppliers have been impacted adversely which will lead to 10% drop in the planned production in February 2020,” it said.
However, the company added that all efforts are on to normalise the situation at the earliest. “At TVS Motor Company, we have completely transitioned to BS-VI in the month of January 2020. To minimise the impact on production of BS-VI vehicles, we are consistently monitoring developments with those of our suppliers who are sourcing certain components from China,” said K.N. Radhakrishnan, director and CEO of TVS Motor.
“The company is also exploring suppliers in other regions and are looking to localise within India. Endeavour is to ensure that the impact on customers and operations is minimal,” he added.
TVS Motor is one of the country’s leading manufacturers of motorcycles, scooters, mopeds and three-wheelers. Its product portfolio includes motorcycles like Apache Series RTR, Phoenix 125, Victor, StaR City+, Sport and Max4R, while the scooter portfolio includes names like Jupiter, Wego, Scooty Zest 110, Scooty Streak and Scooty Pep+.