Maruti Suzuki India (MSIL) posted its highest consolidated net profit of Rs 3,764.2 crore during the second quarter of 2023-24 (FY24). This comes in the backdrop of its highest-ever quarterly sales, a softening of commodity prices, cost reduction efforts, and favourable foreign exchange rates.
In Q2 of FY24, the company’s net profit increased by 78.2 per cent compared to the same period last year when it was Rs 2,112.50 crore.
India’s largest carmaker reported a 6.3 per cent year-on-year (Y-o-Y) increase in domestic passenger vehicle (PV) sales, at 482,731 units, in Q2 of FY24.
This growth in domestic sales was primarily driven by a remarkable 117.5 per cent surge in utility vehicle sales, while sales of mini, compact, and mid-sized cars fell during Q2.
MSIL declared that it attained leadership in the sports utility vehicle (SUV) segment due to its robust product line up. The company now holds a 23.3 per cent share of the Indian SUV market.
Exports increased by 9.7 per cent Y-o-Y to 69,324 units in Q2 of FY24.
During the last quarter, MSIL expanded its export portfolio by shipping the Jimny to Latin America, the Middle East, and Africa, maintaining its pole position as India’s largest passenger vehicle (PV) exporter.
In Q2, the company attributed its margin improvement to five factors — improved realisations, softening commodity prices, cost-reduction efforts, relatively better sales volume and higher non-operating income.
Himanshu Singh, research analyst, Prabhudas Lilladher, said that MSIL’s margin improvement had an element of inventorisation (high-inventory levels) as well. This should get reversed in the coming quarters, he felt.
“Structurally, MSIL has successfully transitioned from primarily being in the small cars’ space to becoming a leader in the SUV segment. We see this trend continuing,” he added.
MSIL’s total income in Q2 surged by 24.1 per cent Y-o-Y to reach Rs 30,541.7 crore, while its total expenses for the same quarter increased by 18.6 per cent to Rs 27,925.6 crore.
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