FILE PHOTO: A worker adjusts the windscreen wipers of a parked car at a Maruti Suzuki stockyard on the outskirts of the western Indian city of Ahmedabad September 1, 2011. REUTERS/Amit Dave/File Photo
DELHI: Maruti Suzuki India Ltd, India’s largest carmaker, reported better-than-expected quarterly profit as sports utility vehicles drove an increase in sales.
Net income rose 48% to 38.8 billion rupees (US$466mil) in the three months ended March 31 from a year earlier, the unit of Japan’s Suzuki Motor Corp said in a stock exchange filing.
The company slightly exceeded the average analyst forecast of 38.39 billion rupees based on a Bloomberg survey of brokerages.
Revenue, which missed estimates, climbed 19% to 382.3 billion rupees, according to the filing.
Total expenses rose 16% to 343.6 billion rupees, while raw material costs advanced 10% from the year-ago quarter.
The company also announced a dividend of 125 rupees per share.
The profit boost was “on account of higher sales volume, favourable commodity prices, cost reduction efforts and higher non-operating income,” Maruti said in the earnings presentation.
The robust earnings come as Maruti Suzuki reaps the rewards of pivoting its focus from small hatchbacks to bigger sport utility vehicles that are in high demand among the country’s burgeoning middle-class.
It sold 642,286 utility vehicles, including SUVs, crossovers and minivans, in the year ended March 31 – the highest among all carmakers, according to the Society of Indian Automobile Manufacturers.
Maruti’s shares jumped 22% in the March quarter, making it one of the top performers in the benchmark S&P BSE Sensex this year.
It has also reclaimed the title of India’s biggest carmaker by market value from Tata Motors Ltd.
Sales in the domestic market climbed 12% to 505,291 units and exports jumped 22% during the quarter, it said in a separate filing.
The carmaker posted record sales of two million for the year ended March 31, according to the filing.
The company’s domestic profit “may keep rising in fiscal 2025 ending March and beyond, propelled by India’s robust auto demand” and the rising vehicle production capacity, Bloomberg Intelligence’s senior industry analyst Tasuo Yoshida wrote in a note last Friday.
The carmaker’s exports were boosted by its emphasis on the African market, where it is working with Toyota Motor Corp and Toyota Tsusho Corp, Yoshida wrote.
Maruti increased prices of its Swift hatchback models by as much as 25,000 rupees and Grand Vitara Sigma sport utility vehicle by 19,000 rupees earlier this month.
The company is gearing up for long-term growth.
It plans to double its annual production capacity to almost four million cars by 2031.
It will plow 350 billion rupees into a second factory in the western state of Gujarat and spend 32 billion rupees on a new production line at its existing plant there.
Maruti is also building a new factory in the northern Indian state of Haryana.
Maruti, which has lagged behind in the switch to cleaner transport, plans to have a lineup of six electric vehicles (EVs) by 2031, with the first one launching by 2025.
It’s also planning to start exports of EVs to Japan and some countries in Europe this year. — Bloomberg
