Maruti Suzuki Q1 Result: Net Profit Jumps Over Twofold To Rs 2,525 Crore, Net Sales At Rs 32,338 Crore

Maruti Suzuki India on Monday said its board has approved the acquisition of the entire stake in Suzuki Motor Gujarat from Japan-based parent Suzuki Motor Corporation

Maruti Suzuki's total sales, including domestic and overseas markets, were by up 6  per cent at 4,98,030 between April-June 2023 vis-à-vis 4,67,931 units sold in the corresponding period of the previous year. ( Image Source :Getty )

Indian auto major Maruti Suzuki India Ltd (MSIL) on Monday said its consolidated net profit surged over twofold to Rs 2,525 crore for the first quarter ended on June 30, 2023. The auto major had reported a net profit of Rs 1,036 crore in the same period of 2022-23. Maruti Suzuki's total revenue from operations increased to Rs 32,338 crore in the April-June quarter from Rs 26,512 crore in the year-ago period, according to an exchange filing by the company.

The carmaker’s total sales, including domestic and overseas markets, were by up 6  per cent at 4,98,030 between April-June 2023 vis-à-vis 4,67,931 units sold in the corresponding period of the previous year. Out of that, domestic sales stood at 4,34,812 units in Q1FY24, higher than the 3,98,494 units sold in the same period last year.

The company on Monday said its board has approved the acquisition of the entire stake in Suzuki Motor Gujarat from Japan-based parent Suzuki Motor Corporation. Currently, Suzuki Motor Corporation (SMC) owns a 100 per cent stake in Suzuki Motor Gujarat (SMG) which supplies its entire production to Maruti Suzuki.

Maruti Suzuki board in its meeting held on Monday approved the termination of the contract manufacturing agreement with SMG, the auto major said in a regulatory filing. The company's board also approved to exercise the option to acquire SMG stake from SMC subject to all legal and regulatory compliances including minority shareholders’ approval. The auto major expects to complete the transaction by March 31, 2024. It noted that the mode of acquisition including consideration to be paid to SMC shall be decided in a subsequent board meeting.

With the growth of the car market and export potential, Maruti Suzuki would need to increase its production capacity to about 40 lakh cars per annum by 2030-31, almost double from current levels, the auto major said elaborating on the rationale behind the development. This would happen over several locations, some of which are known and some being studied, it added.

On the other hand, given the carbon neutrality requirements, several powertrain technologies such as EVs, Hybrids, CNG, Ethanol etc. will co-exist for a reasonably long period of time, MSI said.

"Managing this scale and complexity of production with multiple powertrains, under different managements, would pose several challenges. The Board of Directors considered this and decided that for the purpose of efficiency in production and supply chain, it is best to bring all production-related activities under the company," the auto major stated.

In terms of actual production, logistics, sales and the cost thereof, there will be no change as the cars earlier supplied by SMG as a contract manufacturer, will now continue to be supplied as before, MSI said. SMG currently has an installed production capacity of 7.5 lakh units per annum.

Maruti Suzuki shares on Monday ended 1.56 per cent up at Rs 9,819.55 apiece on the BSE.