The fall in net profit was due to a provision of Rs 837.6 crore resulting from the withdrawal of indexation benefit and change in tax rate on long term capital gains on debt mutual funds as per the Finance Act 2024.
The company sold a total of 541,550 vehicles during the quarter, of which the domestic market volume was 463,834 vehicles and the export volume was 77,716 vehicles. While the domestic volume declined by 3.9%, the export volume grew by 12.1% compared to the same period of the previous year.
Maruti Suzuki stated that gains from cost reduction efforts, favourable foreign exchange variation and higher non-operating income were offset by higher sales promotion expenses.
The car major hosted a conference call on 29 October 2024. In the conference call, the company was represented by Arnab Roy-CFO.
The company's Manesar facility achieved a significant milestone, crossing the one crore unit production mark. While demand for passenger vehicles (PVs) remained subdued in Q2 FY25, the company implemented increased discounts to stimulate sales. The average discount per car during the quarter was Rs 29,300. However, the company is optimistic about the ongoing festive season, anticipating a potential uptick in demand.
The company aims to achieve a 3.7% year-over-year growth in retail sales from April 2024 to October 2024. Inventory levels have been reduced to approximately one month. The company’s margin decreased in Q2 FY25 due to higher sales promotion expenses and adverse commodity prices. To enhance customer satisfaction, the company extended its warranty package to up to 6 years or 60,000 kilometers.
Domestic sales contributed 86% to the total revenue in Q2 FY25, while exports accounted for the remaining 14%.
Maruti Suzuki India is engaged in the manufacture, purchase and sale of motor vehicles, components, and spare parts (automobiles).