Synopsis
Maruti Suzuki reported an 11% year-on-year decline in Q1 standalone net profit to Rs 3,352 crore despite a 36% rise in revenue, as higher material costs weighed on earnings. Strong growth in SUV sales, exports and market share lifted volumes, while the board approved Rs 561 crore for biogas projects.
Auto major Maruti Suzuki on Friday reported an 11% year-on-year (YoY) decline in its standalone net profit at Rs 3,352 crore in the first quarter, compared with a profit of Rs 3,758 crore in the last year's quarter. The profit was in-line with Street expectations. Revenue from operations in the reporting period increased 36% YoY to Rs 52,456 crore.
The company said material costs had started rising during the quarter and were seriously aggravated during the war. Higher input costs weighed on profit despite strong sales growth.
Maruti's total sales volume rose 29% YoY in the first quarter to 6,82,724 units, which is the highest-ever for the company. The growth was broad-based. Domestic small car sales increased 34%, SUV sales rose 45%, and exports grew 29%. The company's domestic market share improved by 2.3 percentage points to 41.2%.
Maruti said higher sales were supported by the commissioning of its second plant in Kharkhoda. The new capacity helped the company meet demand while keeping dealer inventory low.
At the end of the quarter, network inventory stood at about 13 days, the company said.
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The sharp rise in SUV sales shows Maruti’s continued push into a segment where it had earlier lagged stronger rivals. SUV sales grew 45% in Q1, faster than overall volume growth. Small cars also grew strongly, rising 34%, giving the company support across entry-level and higher-value segments.
Exports remained another growth driver, rising 29% from a year earlier.
The combination of higher volumes, better capacity availability and market share gains helped Maruti deliver strong top-line growth. But the profit decline shows that cost pressure remains a concern.
Along with the quarterly results, Maruti’s board approved four compressed biogas manufacturing projects in the first phase. The projects have a budget of Rs 561 crore. The company said the board will consider further expansion of CBG manufacturing based on the experience of these initial projects.
The move fits into Maruti’s wider strategy of exploring cleaner fuel options beyond electric vehicles, including hybrid technology, CNG and biogas-linked solutions.
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