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Maruti Suzuki, India's largest carmaker, experienced a positive day on the stock market despite a dip in its second-quarter profit. The company's shares surged over 4% on the BSE, reaching ₹ 11,456.80, even though its standalone net profit for the September 2024 quarter declined by 17% to ₹3,069 crore. This seemingly contradictory performance can be attributed to a combination of factors, including strong export growth and positive outlook for the festive season.
While the company's net profit took a hit, its revenue from operations saw a slight increase, rising 0.7% to ₹37,449 crore compared to ₹37,339 crore in the same period of the previous year. This revenue growth was primarily fueled by a surge in exports. Maruti Suzuki sold a total of 541,550 vehicles during the quarter, with 463,834 units sold domestically and 77,716 units exported. Domestic sales volume dipped by 3.9% year-on-year, while export volume witnessed a significant 12.1% growth over the same period last year. This strong export performance demonstrates the company's ability to navigate global markets effectively and capitalize on growing demand for its vehicles abroad.
Looking ahead, Maruti Suzuki is optimistic about the upcoming festive season's impact on its sales. RC Bhargava, the chairman of Maruti Suzuki India Limited (MSIL), noted that the festive season has been positive so far. He highlighted that retail sales, from the end of Shradh to the end of Diwali, are expected to see a year-on-year growth of around 14%. This positive sentiment stems from the anticipation of increased consumer spending during the festive period, which is traditionally a peak sales season for the automotive industry. Maruti Suzuki's strong export performance and the anticipated boost from the festive season suggest a promising outlook for the company in the coming months.
Source: Maruti Suzuki shares gain 4% despite a 17% decline in Q2 net profit