Wednesday, 27 July 2011

Maruti Suzuki Q1 net rises 18% to Rs 549 crore




Maruti Suzuki posted better-than-expected 18% increase in June quarter profit, boosted by other income and rise in sales.  Maruti, where 54.2% stake is held by Japan's Suzuki Motor Corp, suffered production losses worth 483 crores during the quarter as 13-day strike by employees crimped production at its Manesar facility.

"Maruti will have to sustain its volume growth by offering discounts for petrol cars in the coming quarters," said Deepak Jain, analyst at Mumbai-based brokerage firm Sharekhan. 

Maruti is confident of beating the slowdown through measures like discount offers and launch of new products. "There is definitely a slowdown. But demand will pick up during the festive season," said Ajay Seth, CFO, Maruti.  New Delhi-based company posted a net profit of 549.2 crore during the quarter. The company's net sales rose by 3.3% to 83,19 crore during the first quarter. Maruti reported other income of 180 crore for the June quarter. Return on investments accounted for major portion of the other income. Shares in Maruti were up 0.8% at BSE. 

"Rising Yen is worrying sign for Maruti. The company has hedged yen imports for the first quarter and partly for the second quarter," Jain said.

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