Maruti Suzuki India, the country's largest car maker, on Thursday reported 39.4 per cent year-on-year decline in its net profit at Rs 1,358.6 crore for the second quarter ended September 30, dented by lower sales and decline in operating margin. The profit was 5.4 per cent lower compared to Rs 1,435.5 crore in the June quarter.
"The auto major had posted a net profit of Rs 2,240.4 crore in the same quarter last year," Maruti Suzuki India said in a filing to the Bombay Stock Exchange.
The company said that the second quarter earnings were impacted by negative factors, such as lower capacity utilisation, higher sales promotion and depreciation expense, partially offset by cost reduction efforts, higher fair value gains on invested surplus and reduction in corporate tax rate.
Maruti Suzuki's net sales fell by 25.2 per cent to Rs 16,120.40 crore in Q2FY20 as against Rs 21,551.90 crore in Q2FY19. Total revenue during the quarter declined to Rs 17,905.30 crore as compared to Rs 22,959.80 crore in the year-ago period, impacted by fall in sales volumes.
During the quarter under review, the company sold a total of 338,317 vehicles, down 30.2 per cent on the yearly basis. Sales in the domestic market, which constitutes 92.4 per cent of total sales, fell by 31.4 per cent Y-o-Y to 312,519 units. Exports also dipped by 12.4 per cent Y-o-Y to 25,798 units.
The operating margin or EBIT (earnings before interest and taxes) tumbled 74.9 per cent Y-o-Y to Rs 680.20 crore, while profit before tax (PBT) declined 51 per cent to Rs 1,572 crore on the yearly basis.
The company said that the results for the July-September quarter have to be viewed in the context of exceptionally weak demand environment.
Following Q2 results, shares of Maruti Suzuki India were trading 1.27 per cent lower at Rs 7,344.70 apiece on the BSE.
Edited by Chitranjan Kumar