New Delhi, Oct. 28: India’s largest car maker Maruti Suzuki India (MSI) beat Street estimates and posted a threefold jump in net profit at Rs 670.23 crore for the second quarter ended September 30 against Rs 227.45 crore in the same period last fiscal.
“The company’s performance during the quarter has to be viewed in the context of unusually low levels of profit in the second quarter of last year (July-September 2012) owing to labour problems at Manesar,” the automobile manufacturer said in a statement.
Analysts were expecting a net profit in the region of Rs 550 crore.
“Higher localisation and cost reduction initiatives by the company also contributed significantly to the bottomline growth during the second quarter. The overall impact of foreign exchange was positive during the quarter.”
Net sales grew 26.5 per cent to Rs 10,212 crore from Rs 8,070 crore in the same period of the previous year.
“This growth was achieved on the back of focused sales efforts, especially in the rural areas, proper product planning, cost reduction initiatives and gain from rupee depreciation,” MSI managing director and CEO Kenichi Ayukawa said.
According to Maruti’s chief financial officer Ajay Seth, the overall impact of forex gain was Rs 164 crore during the quarter. Ayukawa, however, said the market continued to be difficult because of slow economic growth, high fuel cost and inflation.
“The economic scenario continues to be uncertain and we have to rely on our efforts to increase sales, we will start feeling the impact of rupee depreciation in the later quarters and our target is to sell more than what we sold last year,” Ayukawa said.
Maruti’s sales were up 19.6 per cent in the second quarter to 2,75,586 units compared with 2,30,376 in the year-ago period.