Maruti Suzuki, the country’s largest car manufacturer, on May 13 declared its March quarter profit of Rs 1,291.7 crore, down by 28.1 percent YoY dented by lower sales during the lockdown. But the sharp fall in tax cost limited the profit decline.
The company had reported a profit of Rs 1,795.6 crore for March quarter previous year.
“Profit was lower on account of lower sales volume, higher sales promotion expenses, partially offset by lower operating expenses, cost reduction efforts and reduction in corporate tax rate,” said the company in its BSE filing.
Revenue from operations for the March quarter declined 15.2 percent year-on-year to Rs 18,198.7 crore as sales volumes slipped 16 percent to 3.85 lakh vehicles compared to same period last year.
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The company’s domestic volumes in Q4 fell by 16 percent YoY and exports fell 17 percent compared to same period last year, especially after nationwide lockdown in last 10 days of March and amid slowdown in overall sector.
At operating level, earnings before interest, tax, depreciation and amortisation (EBITDA) plunged 31.7 percent year-on-year to Rs 1,546.4 crore and margin contracted 210 basis points YoY to 8.5 percent in quarter ended March 2020.
For the year, profit fell 24.7 percent to Rs 5,650.6 crore compared to previous year on account of lower sales volume, higher sales promotion expenses and higher depreciation expenses, partially offset by lower operating expenses, cost reduction efforts, higher fair value gains on invested surplus and reduction in corporate tax rate.
Revenue during the year dropped 12.1 percent to Rs 75,610.6 crore as sales volumes declined 16.1 percent to 15.63 lakh compared to previous year.
Meanwhile, Maruti recommended a dividend of Rs 60 per share for FY20.
After the nationwide lockdown, Maruti restarted the production of vehicles at its Manesar plant from May 12.
Company had zero sales in the domestic market, (including sales to OEM), in April 2020. “This was because in compliance with the Government orders all production facilities were closed,” it said.
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The stock fell around 17 percent in last one year period, while it lost 32 percent year-to-date and fell 23 percent during March quarter.
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