Maruti Suzuki Q1 net profit plunges over 27% to Rs1,435 crore

Maruti Suzuki India Ltd, the nation’s largest carmaker, has reported a 27.3 per cent fall in its net profit for fiscal first quarter ended 30 June 2019, dragged down by lower sales.

The car maker reported a net profit of Rs1,435.5 crore, down 27.3 per cent from % compared to the Rs1,975.3 crore net profit reported in the quarter ended June 2018.
Earnings before interest, tax, depreciation and amortisation (EBITDA) for the April-June 2-19-2- quarter declined by 38.9 per cent to Rs2,048 crore while margin contracted 450 bps to 10.4 per cent compared to the year-ago period.
The company, however, maintained margin above 10 per cent level despite subdued environment.
Maruti in its BSE filing said higher fair value gain on invested surplus and cost reduction efforts supported margin, but higher depreciation expenses, lower capacity utilisation, adverse commodity prices and higher sales promotion expenses dented margin.
Demand environment may remain uncertain going forward, it added.
Finance cost during the quarter grew by 164 per cent year-on-year to Rs54.7 crore and depreciation cost increased by 27.6 per cent to Rs918.6 crore compared to the year-ago period due to Ind-AS adjustment.
Tax expenses declined sharply by 47.6 per cent to Rs475.4 crore in Q1 YoY.
During the quarter, the company recorded net sales of Rs18,735.2 crore, down 14.1 per cent compared to the same period of the previous year. Maruti attributed this to lower sales volume and higher depreciation expenses.
Maruti Suzuki sold a total of 402,594 vehicles during the quarter, which is 17.9 per cent lower compared to the same period of the previous year. Sales in the domestic market stood at 374,481 units, lower by 19.3 per cent. Exports were at 28,113 units.