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A low base effect magnified the second quarter profits of the country’s No 1 passenger car-maker, Maruti Suzuki, near-three times at Rs 670 crore. In the corresponding previous quarter ended September 30, 2012, production shutdown for a month following a violent labour clash at its Manesar facility had eroded the bottomline to Rs 227 crore.
For the latest quarter, the company’s net sales stood at Rs 10,212 crore, up 26.5 per cent over the same period last year (Rs 8,070 crore). The company sold 2.75 lakh vehicles, up 20 per cent against 2.30 lakh units in the same period last year.
“The market slowdown continued in the second quarter of the current fiscal. Slowing GDP growth rate, rupee depreciation, rising fuel prices and inflation are impacting customer sentiment and vehicle sales remain under pressure,” Kenichi Ayukawa, Managing Director and Chief Executive Officer, Maruti Suzuki, told reporters here.
The overall impact of foreign exchange gain was Rs 164 crore during the quarter compared to the year-ago period, said Ajay Seth, Chief Financial Officer. “Material costs came down compared to the second quarter last year. The fact that we had some price increase and higher localisation also contributed to the bottomline,” Seth said.
Ayukawa said tightening on lending by some banks brought pressure on sales. He said sales in the diesel segment continued to decline, by 50 per cent in the quarter. But petrol vehicles, after declining continuously for two years, saw a sales growth of 16 per cent.
“In the industry, the share of diesel vehicles is down to 53 per cent from 61 per cent in the same period a year ago,” he said. Because of this, domestic sales declined 3 per cent in the industry. “But we did better than the industry and achieved 15 per cent growth over the same period last year.”
Ayukawa expects the rupee, whose depreciation had made import (of components) expensive, to improve in the second half of this fiscaland also that demand buoyancy will continue after the festival season.
>ronendrasingh.s@thehindu.co.in
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