Maruti Suzuki reports Q1 profit at ₹475 crore
The carmaker’s revenue jumped more than four times to ₹17,770.7 cr against ₹4,106.5 cr in Q1FY21
NEW DELHI: The country’s largest carmaker Maruti Suzuki India (MSI) on Wednesday reported a consolidated net profit of ₹475 crore for the first quarter ended June 30.
The auto major had posted a net loss of ₹268 crore in the April-June quarter of 2020-21, MSI said in a regulatory filing.
Its total revenue from operations stood at ₹17,776 crore in the first quarter as compared to ₹4,111 crore in the year-ago period.
Sequentially, however, the profit declined 62.19% from ₹1,166.10-crore profit reported in the March quarter of FY21 as auto sales remained disrupted due to localised lockdown during April and May.
The company said it has sold a total of 353,614 vehicles during the first quarter. Sales in the domestic market stood at 308,095 units, while exports were at 45,519 units.
In comparison, during the same period previous year, the company had sold a total of 76,599 units including sales of 67,027 units in domestic market and exports of 9,572 units.
Shares of the company closed 1.27% down at ₹7,149.70 apiece on the BSE.
Earnings before interest, taxes, depreciation, and amortization (Ebitda) in the first quarter of the fiscal year came at ₹821 crore versus an Ebitda loss of ₹863.4 crore last year.
The numbers came below market expectations. Analysts had estimated the profit and revenue numbers at ₹675.7 crore and ₹17,929 crore, respectively,
for the quarter.
In value terms, the company registered net sales of ₹16,798.7 crore in Q1FY22 against net sales of ₹3,677.5 crore in Q1FY21.
”The second wave of the pandemic adversely impacted the production and sales in the first quarter. While all parameters this quarter were substantially better than Q1 of FY21, a comparison is not meaningful because Q1 last year had a much higher degree of disruption due to the pandemic. Sales in Q1 remain far below the previous high in Q1 of FY19,” Maruti said.
Consensus estimate for Ebitda was at ₹1,094 crore with extreme deviations at ₹860.5 crore and ₹1,209 crore.
As expected, Ebitda margins contracted 370 basis points sequentially to 4.6% from 8.3% on higher commodity prices and poor operating leverage. Margins were -21% in Q1FY21.
“The Ebitda came in lower than our expectations on account of higher employee expenses while gross margins fared marginally better than
expectations. Employee cost as a per cent of sales was up 224 bps QoQ while RM cost as a percentage of sales was only up by 90 bps QoQ. Thus, as a result of higher-than-expected employee expense, the Ebitda was 17% below expectations, and Ebitda margins were 98bps below expectations,” noted Milan Desai, lead equity analyst at Angel Broking.
He, however, opines the company has already announced price hikes, therefore Maruti Suzuki can gain some market share in coming years on account of its launches in SUV space, an area where it is underrepresented. He maintains positive stance on stock.
Meanwhile, the Board of the company conferred on Osamu Suzuki the title of ‘Honorary chairman’.
“Osamu Suzuki had retired from the Board of Suzuki Motor Corporation in June 2021. However, he continues to remain on the Board of Maruti Suzuki India Limited and give the company the benefit of his immense experience and knowledge. The
Board took note of his deep commitment to Maruti Suzuki over the last 40 years… The entire nation has benefited from his efforts. In recognition of his services to the company the Board of Directors unanimously decided to confer on him the title of ‘Honorary Chairman’,” the company said.
Earlier this month, Maruti Suzuki announced a price hike for select models in its range, including the Swift and the entire CNG vehicle portfolio, details of which are available here. The company added that the hike of up to ₹15,000 would vary for each vehicle.
The Zxi Plus AMT dual-tone variant receives the smallest hike of ₹1,000, followed by the Lxi variant, prices of which have been increased by ₹8,000.
All other variants of the Maruti Suzuki Swift, including the Vxi, Vxi AMT, Zxi, Zxi AMT, Zxi Plus, Zxi Plus dual-tone, and Zxi Plus AMT have witnessed a uniform increase of ₹15,000. The price hike, according to the carmaker, was attributed to the increase in various input costs.