Maruti Suzuki looks at markets abroad as rupee gains boost Q1 net 49% to Rs632 cr
25 July 2013
Maruti Suzuki India Ltd, the country's biggest carmaker, today reported a net profit of Rs631.6 crore for the quarter ended 30 June 2013, up 49 per cent compared with a net profit of Rs423.77 crore for the April-June quarter of last fiscal, helped by an increase in export realisations on the back of a falling rupee.
The company's net sales (net of excise) at Rs9,995.1 crore during April-June 2013, however, showed a drop of 5.1 per cent over net sales of Rs10,529.24 crore reported during the same period of the previous year.
The fall in unit sales was in line with the overall industry, and the company was able to maintain its market share, Maruti Suzuki said in a statement released today.
Favorable foreign exchange rates during the quarter helped improve export realisation and limit the impact of declining domestic sales, the company said.
The increase in net profit was due to focused cost reduction efforts undertaken by the company, favourable foreign exchange rates and the benefit from merger of Suzuki Power train India Limited (SPIL) with Maruti Suzuki during the last financial year, the company said.
Total vehicle sales were down 9.98 per cent at 2,66,343 units, from 2,95,896 units in the year-ago period as the auto market continued to reel under demand slump.
Maruti Suzuki is seeking to sell more cars overseas to offset slowing demand at home, where it expects sales volumes to grow between 0 and 5 per cent in the current financial year.
Maruti Suzuki, which accounts for 40 per cent of all passenger vehicle sales in the country, is facing global competition in the small car segment, which is its forte.
Automakers are stepping up new launches in a market that has seen falling sales for eight months in a row against two years of steady growth two years ago.
The company has warned of a possible decline in profitability as it expects discounts on car prices to increase in the current quarter due to weak demand amidst rising fuel prices.
"Exports are high on our agenda particularly when the domestic markets are not growing," a Maruti executive told a conference call with analysts.
However, Maruti expects export volumes to be flat for the current financial year. Exports accounted for 8 percent of total sales of 266,434 vehicles during the quarter.