The Board of Directors, Maruti Suzuki India made some very interesting announcements today. Most important of them all was the preponement of the start of their new Gujarat plant. This new car manufacturing plant will now start in Jan 2017, instead of the earlier decided May 2017.
The preponement is being done so as to meet the rise in demand for new Maruti Suzuki cars, which are currently offered with a high waiting period. This new plant will be owned by Suzuki Motors, and not Maruti Suzuki India. Maruti Suzuki will buy cars from Suzuki.
RC Bhargava, Chairman, Maruti Suzuki also apologized to their consumers for the waiting periods. He has promised that the production will soon be increased to reduce waiting periods. In spite of a challenging market, Mr. Bhargava is once again aiming at posting double-digit growth for the new fiscal.
Maruti Suzuki India Limited (MSIL) has reported an 11.73 percent decline in net profit for Q4 FY 2015/16 YoY. This stood at INR 1133.60 crores for January to March 2016 quarter while the company experienced net profits to the tune of INR 1284.20 crores in the corresponding quarter in 2015.
A total of 360,402 vehicles were sold in the Q4 signaling growth of 3.9 percent while total exports stood at 27,009 units. Net sales stood at INR 149,295 million, a 12.5 percent growth over sales in the same period of the previous year.
Taking into account the period April 2015 to March 2016, MSIL sold a total of 1,429,248 units during the period with growth recorded at 10.6 percent. Exports during the same period stood at 123,897 units.
Net sales accounted for INR 563,504 million during the period April 2015 to March 2016 resulting in growth of 15.9 percent as compared to net sales over the same period of the previous year while net profits were up 23.2 percent and stood at INR 45,714 million (INR 4,571 cr). This could be attributed to new product launches and expansion of dealer and sales network besides cheaper raw materials and other price reduction incentives.
Following the declaration of these results, MSIL announced a dividend of 700 percent for 2015-16 as against 500 percent declared in 2014-15. Post the announcement, Maruti Suzuki share price touched day’s high of 3,885 on BSE, up by almost 4%, before ending the day at 3,869.45, up by 3.62%.