Maruti Suzuki India reported a rise of 57.7% in profit after tax for the quarter ended March 31, 2021. The leading car manufacturer of the country recorded net profit of ₹1,838.9 crore during the quarter under review, compared to ₹1,166.1 crore in the year-ago period. The rise in quarterly profit came on the back of cost reduction efforts, lower sales promotion expenses and increase in selling prices, and higher non-operating income, despite high commodity prices.
The company's sales volume dip 0.7% during the March quarter to 488,830 units, compared to 492,235 units in the corresponding quarter last year. Maruti Suzuki, along with other auto manufacturers, has been dealing with the adverse impact of continued global semiconductor shortage that affected production, and subsequently, sales.
The sales in the domestic market stood at 420,376 units, a decline of 8% over that in Q4 FY21. However, the sales in the export market were at 68,454 units which is the highest ever in any quarter.
“Production during the year was impacted by shortage of electronic components by an estimated 270,000 vehicles, mostly domestic models, because of which there were pending customer bookings of about 268,000 vehicles at the end of the year. In addition, the first quarter witnessed a disruption owing to the second Covid wave,” the company mentions in an exchange filing
Revenue from sales, however, climbed 11.1% to ₹25,514 crore, as opposed to ₹22,958.6 crore in the same quarter of the previous fiscal. Operational earnings before interest and taxes (EBIT), or operating profit, grew 42.4% to ₹1,779.6 crore from ₹1,250.1 crore.
For the entire financial year 2021-22, Maruti Suzuki reported a decline in profit after tax at ₹3,766.3 crore, down almost 11% compared to ₹4,229.7 crore seen at the end of FY21.
Sales volume grew slightly to 1,652,653 units during FY22 from 1,457,861 units during FY21, taking net sales during the fiscal to ₹83,798.1 crore, compared to ₹66,562.1 crore. Operational profit stood at ₹2,914.7 crore at the end of FY22, compared to ₹2,313.8 crore in FY21.
“In FY22, the sales performance of the company was significantly affected due to Covid-19 related disruptions and electronic component shortages. However, in FY21 the sales performance was affected largely due to COVID-19 related disruptions. As the degree of disruption was entirely different, any comparison of FY22 over FY21 would not be meaningful,” the company notes in its statement.
The overall sales during FY22 in the domestic market stood at 1,414,277 units, an increase of 3.9% over FY 2020-21. The company recorded its highest ever exports of 238,376 units in FY22 compared to 96,139 units in FY21. This was also about 62% higher than the peak exports in any financial year so far.
Depsite drop in profit, Maruti Suzuki's board of directors recommended a dividend of ₹60 per share (face value of ₹5 per share) for FY22, compared to ₹45 per share in FY21.
“This is a special one-time gesture to thank shareholders for their patronage and support as the company commemorates its 40th year since inception,” Maruti Suzuki states.
The dividend will be paid on September 8, 2022 subject to the approval of the shareholders in the ensuing annual general meeting on August 31, 2022.