Maruti Suzuki’s Q3 net profit zooms 133% to ₹2,351 crore on lower input costs

• Maruti Suzuki more than doubled its standalone net profit to ₹2,351 crore in Q3, from ₹1,011 crore in the same period last year, while its revenue rose 25.5% during Q3 to ₹27,849 crore.
• The profit beat was on the back lower raw material costs during the quarter.
• Its customers continued to shun mini cars like the Alto, while the utility vehicles segment – which includes cars like the Brezza, S-Cross among others – grew 23% YoY in Q3.

India’s leading car maker Maruti Suzuki India on Tuesday reported third-quarter standalone net profit rose 133% over last year to ₹2,351 crore, while its revenue rose 25.5% to ₹27,849 crore, beating analyst$4. The better-than-expected revenue and profit growth was on the back of higher sales and lower input costs.

For Q3 FY23, Maruti Suzuki reported a 22.7% sequential decline in its raw material costs.

Softer commodity prices, improved realisations and cost reduction efforts aided Maruti Suzuki’s margins during the quarter, the company said.

The car manufacturer’s operating margins continued to improve, rising 304 basis points YoY to 9.75% during the December quarter, its highest in the last eight quarters.

Maruti Suzuki’s total sales stood at 4.65 lakh units, up 8.2% from Q3 FY22 but down 10% on a sequential basis.

On a sequential basis, the carmaker’s revenue declined 2.4%, while net profit increased 14% for Q3FY23. The sequential decline in sales and higher discounts during the December quarter resulted in muted performance, but lower raw material prices helped the company shore up profits during the quarter.

Demand softens in Q3, electronic component shortage worsens

Maruti Suzuki also reported a softening in demand during Q3, with its order book declining to 3.63 lakh units from 4.12 lakh in Q2. Orders for new vehicles also fell to 1.19 lakh units in Q3, from 1.3 lakh units in Q2.

It also reported that the shortage of electronic components worsened during the quarter – affecting production of 46,000 vehicles, up from 35,000 vehicles in Q3.

Maruti Suzuki’s Q3 in numbers:

Particulars	Q3 FY23	Q2 FY23	Q3 FY22
Revenue	₹27,849 crore	₹28,544 crore	₹22,188 crore
Net profit	₹2,351 crore	₹2,062 crore	₹1,011 crore
Net margin	8.4%	7.4%	4.6%
Total sales (units)	4,65,911	5,17,395	4,30,668

Source: Company reports

Entry-level car sales fall as customers shift to more premium cars

Customers continued to shun Maruti Suzuki’s mini cars like Alto – the mini segment reported a decline on both YoY as well as sequential basis, alongside the vans and light commercial vehicle segments.

On the other hand, the company reported a strong uptake in the mid-size and utility vehicle segments, which grew on both YoY as well as sequential basis.

The utility vehicle segment, which includes cars like the Brezza, S-Cross, XL6 and Grand Vitara, now accounts for nearly 24% of Maruti Suzuki’s domestic sales in Q3 FY23, up from 21.5% in Q3 FY22.

Maruti Suzuki’s domestic sales across segments:

Segment	Q3 FY23	Q3 FY22	YoY	Q2 FY23	QoQ
Mini	52,952	55,624	-5%	72,069	-27%
Compact	2,04,031	1,75,054	17%	2,28,551	-11%
Mid-size	4,592	3,362	37%	4,254	8%
Utility vehicles	96,542	78,637	23%	82,778	17%
Vans	26,625	29,056	-8%	37,744	-29%
Light commercial vehicles	7,098	10,103	-30%	8,692	-18%
Sales to other OEMs	12,089	13,837	-13%	20,112	-40%
Total domestic sales	4,03,929	3,65,673	10%	4,54,200	-11%

Source: Company reports


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