Tag: Maruti Suzuki

Auto launches this week: BMW Limousine to Maruti Swift to Tata Ace EV

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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As the global economy shifts gears towards sustainability and innovation, the automobile industry is seeing several key developments and announcements. It’s another week when we focus on electric vehicles, autonomous driving, and other cutting-edge technologies to shape the future of mobility.

Here are the auto launches for this week:

BMW 3 Series Gran Limousine M Sport Pro Edition

BMW India launched the new 3 Series Gran Limousine M Sport Pro Edition on Thursday, May 9, 2024. The car is available at all dealerships and the BMW Online shop and is manufactured locally at the BMW Group Plant in Chennai. It comes in the 330Li petrol variant and is offered in four metallic paintworks – Mineral White, Skyscraper Grey, Carbon Black, and Portimao Blue. The limousine is powered by a two-litre four-cylinder petrol engine and comes with an ex-showroom price of ₹62.6 lakh.

Ace EV 1000

Tata Motors launched a new electric mini-truck, the Ace EV 1000, on May 9, 2024, which offers a payload of 1 tonne and a certified range of 161km on a single charge. The vehicle is powered by the EVOGEN powertrain and comes with a 5-year maintenance package and a 7-year battery warranty. The vehicle is powered by a 27kW (36hp) motor with 130Nm of peak torque and equipped with an advanced battery management system and Fleet Edge telematics system.

Maruti Suzuki Swift

Carmaker Maruti Suzuki has unveiled the fourth generation of Swift, one of the company’s most successful models on Indian streets since 2005. The starting price of the all-new Swift is ₹6.49 lakh (ex-showroom), and it is available to pre-book the latest hatchback with an initial payment of ₹11,000. The engine inside is the 1.2-litre, three-cylinder Z-Series variant and comes with six airbags. It will be available in nine colours, including six mono-tone and three dual-tone options, and the dual-tone options are available at an additional cost of ₹15,000.

Xoom 125 cc and Xoom 160 cc scooters

On May 8, Hero MotoCorp announced its plans to launch the Xoom 125 cc and Xoom 160 cc scooters ahead of this year’s festive season, which starts in October, with Vijayadashami on October 12, 2024, and Diwali on November 1, 2024.

EV brand Onvo

China electric vehicle maker Nio partners with larger rival BYD to launch the lower-priced EV brand Onvo to compete with Tesla. The new brand is known as “Onvo” in English and “Ledao” in Chinese, and it is a website for the car. Nio has said it expects the new Onvo L60 to compete with the Tesla Model Y.

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Maruti Suzuki expects to export 30,000 Swift cars annually, says MD Hisashi Takeuchi

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Maruti Suzuki, India’s leading automobile manufacturer, has raised the stakes in the hatchback segment with the unveiling of its fourth-generation New Swift. Priced at over ₹6.49 lakh, the new Swift promises not only a refreshed design but also a brand-new engine, set to invigorate the hatchback market in India.

The auto major hopes to revitalise the hatchback segment in India. Apart from styling updates, the new version of Swift will have a new 3-cylinder motor giving the model a brand new engine. The fourth-gen Swift has already hit international markets like Japan and the UK.

Hisashi Takeuchi, the Managing Director of Maruti Suzuki, in an exclusive interview with CNBC-TV18, expressed his optimism about the prospects of the new Swift, particularly in terms of exports.

“This new Swift is also very important for the export market and from India, we have been exporting lot of Swift. Our export volume is growing in a rapid pace and this Swift we are expecting to sell annually more than 30,000 units for export market.”

Takeuchi emphasised the crucial role of the hatchback segment in India’s evolving automotive landscape. “With a growing number of new car buyers entering the market, especially those transitioning from motorcycles to cars, we believe that the hatchback segment will remain pivotal,” he stated. “Hence, the introduction of this latest iteration of the Swift is strategically important for us.”

Read Here | Maruti Suzuki says the all new Swift offers 14% better mileage — check prices and features

Looking ahead, Takeuchi projected a revival in the hatchback segment within the next three to four years and emphasised the importance of maintaining a significant market share until then.

Partho Banerjee, Head of Sales at Maruti Suzuki, echoed Takeuchi’s sentiments regarding the potential of the premium hatchback segment. “Last year, the premium hatch segment witnessed sales of close to 7 lakh vehicles, and we expect this figure to grow to 1 million cars by 2030.”

Banerjee said. “In this scenario, the Swift is poised to play a major role in shaping the future of the premium hatchback segment.”

The conversation also touched upon Maruti Suzuki’s foray into electric and hybrid vehicles. Takeuchi revealed plans for the global unveiling and production commencement of the company’s first electric vehicle within the current financial year.

Additionally, Maruti Suzuki aims to incorporate hybrid technology into more models as part of its long-term strategy.

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Maruti Suzuki likely to begin mass production of EVs for India in FY26: RC Bhargava

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Maruti Suzuki India will likely begin mass production of electric vehicles (EVs) for the Indian market only in FY26 (April-March 2025-26), said RC Bhargava, Chairman of the country’s largest passenger car maker.

In an exclusive interview with CNBC-TV18, Bhargava said the company’s best-ever sales performance is being driven largely by the sport utility vehicle (SUV) segment as “it will be a while before the entry-level segment revives”.

He does not foresee the need to raise product prices this year given the cost-cut initiatives are working in their favour. However, Bhargava feels it is “futile to try and predict margins in such uncertain times.”

Below are the excerpts of the conversation:

Q: Could you just run us through the performance across segments? Where have you seen the maximum strength, where have you seen pick up and what do you expect for FY25?

A: In the last two years what has been happening is that the SUV segment has been the fastest growing segment. The bulk of our growth has also come from that segment, whether in numbers, topline or profits.

The entry-level segment has not revived, in fact, it has gone down a bit. I think it will take maybe a couple of years more before we see any movement there.

Q: As we start a new financial year, what is your expectation for the SUV segment? Is it expected to remain as strong as it has been last year?

A: The trend will continue this year at least with the SUV segment leading the entire sales of cars in India. I don’t think there is any reason to think that there will be a change in consumer thinking or behaviour regarding what they want in this segment.

As I said the entry-level segment, the small car segment buyers are still not coming back to the car market. Amongst those who buy cars in the more expensive brackets, the sedans fundamentally are losing ground to the SUVs and I don’t see this trend changing.

Q: Could you tell us what Maruti’s plans, and ambitions are on EV side in FY25?

A: FY24-FY25 we are not going to have very much in the way of electric cars at all. The plan is to start production towards the end of this financial year and mass production follows a little bit after the start of production. Also, I believe the commitment is that the bulk of the first lot of production will be exported to Europe. So, the domestic market will get electric cars in numbers from Maruti only after April 2025.

Also Read | Maruti Suzuki will have to offer more discounts, says analyst after Q4 results miss estimates

Q: Commodity prices have moved higher recently, and forecasts show that across the board, commodities will remain pretty strong. Is the market strong enough to take price increases as and when it is required? What’s your sense? Can you improve on these margins? The Street in the fourth quarter was expecting a margin of about 13.5%. Will the direction of travel be in that 13% plus kind of range?

A: It is still not very clear what is going to happen to commodity prices. Some items are going up, but some items are not going up, they are still coming down. What the net result will be, I think you will have to wait a bit longer to see the impact of the Iran-Israel situation, and what happens to China.

If electric car sales continue to fall the world over, the total car market will come down globally. This will mean less demand for various materials and that could also have an impact on material prices. If the Yen continues to weaken against the dollar, it always helps us in terms of material costs. Other factors which are important are that as a company, we have to continue our efforts to reduce costs everywhere.

Also Read | Maruti Suzuki declares dividend of Rs 125 per share, the highest-ever in its history

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Maruti Suzuki will have to offer more discounts, says analyst after Q4 results miss estimates

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Maruti Suzuki shares were in focus on April 29, after India’s largest passenger carmaker reported earnings for the January to March 2024 quarter that fell short of CNBC-TV18 poll projections on various parameters.

Brokerage firms Nomura and Kotak Institutional Equities have neutral and sell calls on the stock, respectively, with target prices below the last closing price on April 26. However, HSBC and Motilal Oswal have given the stock a buy rating and see a potential upside of 10% and 16%, respectively.

Maruti market share at risk?

Despite the divided stance in terms of ratings and target price, all analysts have highlighted that Maruti Suzuki is likely to witness a decline in market share over FY25-26.

In March 2024, Maruti retained its top spot with a lion’s share of 39.33% in the passenger vehicles segment compared to 40.48% in the year-ago period, according to Federation of Automobile Dealers Associations of India (FADA) data. At the end of FY24, its share stood at 40.66%, down from 40.94% in FY23.

Nomura is of the view that the market share may face risk in FY25-26. Kotak says its market share may decline to 40.5-41% over the financial year owing to newer launches by competitors.

Will Maruti offer more discounts?

Nomura also believes discounts at Maruti will likely rise as inventory has filled up. In its report for March, FADA also pointed out that the downturn in the PV segment was influenced by heavy discounting and selective financing further affected by economic worries and the electoral climate.

(As sales slow down, automakers often offer discounts and other offers to lure buyers.)

In a brokerage note on automobiles, Motilal Oswal pointed out, “Entry-level demand continues to face pressure for Maruti Suzuki, with discounts remaining consistent on a MoM basis. There are no discounts on Maruti’s Brezza/Ertiga and Tata Motors’ Nexon. The waiting period continues to remain under two months for M&M XUV700 and ScorpioN. Inventory for all the key PV OEMs stood at 40-45 days.”

Also Read: Maruti Suzuki declares dividend of ₹125 per share, the highest-ever in its history

Motilal Oswal also noted that Maruti’s operating performance in the fourth quarter of FY24 was below its estimates as benefits from operating leverage (140bp) and lower discounts (80bp) were partially offset by one-off costs (60bp).

Reflecting on demand, Maruti’s management said, its enquiries are growing in high-single digits.

What will drive growth in FY25?

– Improved mix
– GST cuts or favourable policy for hybrids

Kotak expects the volume trajectory for the industry to remain muted over FY25 due to weakness in the entry-level segment’s demand and receding order book in the SUV segment.

However, HSBC sees FY25 growth at 5-6% largely driven by CNG and exports. It also added that a cut in taxes on hybrids is an upside risk.

Even as Maruti reported an EBITDA margin of 12.2% for the quarter, 120 basis points below expectations of 13.4%, due to higher ad spends and higher manufacturing overheads, HSBC says its FY25/26 expectations remain unchanged.

It also said that post-run-up, the stock will likely be rangebound in the near term but the brokerage’s medium-term outlook remains positive.

Motilal Oswal marginally raised its FY25-26 estimates by 2-4% for Maruti, noting that it expects the carmaker to continue to outperform industry growth in the current fiscal. While the bulk of input cost benefits are likely to be behind, MO expects Maruti to post about 70bp margin improvement to 12.5% in FY25, largely led by an improved mix.

“This would, in turn, drive a steady 13% earnings CAGR over FY24-26E. Any GST cuts or favourable policy for hybrids by the government may drive a rerating as Maruti would be the key beneficiary of such changes,” it added.

The firm’s multi-tech approach seems best-suited for India, it further said.

Maruti Suzuki shares traded flat at ₹12,737.10 on NSE at 9:59 am. 

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Maruti Suzuki declares the biggest dividend even as ad spends cap profit margin

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Maruti Suzuki India Ltd., India’s largest passenger car maker reported a net profit of ₹3,877.8 crore during the January-March period. The number was lower than the CNBC-TV18 poll of ₹4,104 crore. On a year-on-year basis, the company’s net profit grew by 47.8%

Revenue for the quarter stood at ₹38,235 crore, a growth of 19.3% from last year, but was marginally lower, compared to the CNBC-TV18 poll of ₹38,672 crore.

Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for the quarter missed expectations, coming in at ₹4,685 crore, while a CNBC-TV18 poll had pegged the figure at ₹5,178 crore.

Maruti reported an EBITDA margin of 12.2% for the quarter, 120 basis points below expectations of 13.4%. Margins for the quarter were impacted by higher ad spends and higher manufacturing overheads. However, they expanded by 170 basis points from the year-ago quarter.

Better capacity utilisation, cost reduction efforts, softening commodity prices, improved realisation and higher non-operating income tried offsetting the margin headwinds.

Raw material costs as a percentage of net sales stood at 74.4% in financial year 2024 compared to 76.5% in financial year 2023.

Sales volume for the quarter grew by 13.4% from last year to 5.84 lakh units from 5.14 lakh units last year.

Maruti Suzuki also declared a dividend of ₹125 per equity share, which is the highest in the company’s history.

Shares of Maruti Suzuki India fell 1.2% on Friday ahead of results to end at ₹12,760. The stock recently made a record high of ₹13,073 and is up 24% so far in 2024.

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Maruti Suzuki declares dividend of ₹125 per share, the highest-ever in its history

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The board of Maruti Suzuki India Ltd. on Friday approved a final dividend of ₹125 per share for the financial year ended March 31, 2024. This is the highest dividend the company has paid since listing, according to the data available on the exchanges.

This will result in a total payout of ₹3,930 crore, the automaker said while announcing its March quarter earnings.

The dividend will be subject to approval by the shareholders at the next annual general meeting, Maruti said in a release.

Before this, Maruti declared a final dividend of ₹90 per share in August last year, followed followed by a ₹60 final dividend in August 2022.

Shares of Maruti will likely trade ex-dividend on the day or a day before the record date. When a company goes ex-dividend on a particular date, its stock does not carry the value of the next dividend payment. An ex-dividend date also dictates which shareholders are eligible to receive the dividend payment.

Meanwhile, Maruti Suzuki reported a net profit of ₹3,877.8 crore during the January to March period. The number was lower than the CNBC-TV18 poll of ₹4,104 crore.

Revenue for the March quarter came in at ₹38,235 crore, which was marginally lower as against CNBC-TV18’s poll of ₹38,672 crore.

EBITDA or Earnings Before Interest, Tax, Depreciation and Amortisation for the quarter missed expectations, coming in at ₹4,685 crore, while a CNBC-TV18 poll had pegged the figure at ₹5,178 crore.

Maruti reported an EBITDA margin of 12.2% for the quarter, 120 basis points below expectations of 13.4%. Margins for the quarter were impacted by higher ad spends and higher manufacturing overheads.

Sales volume for the quarter rose by 13.4% from last year to 5.84 lakh units from 5.14 lakh units last year.

On Friday, shares of Maruti Suzuki India Ltd. ended 1.26% lower at ₹12,760 on the National Stock Exchange. The stock has risen 25% so far this year.

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Maruti Suzuki Q4 Results Preview: Strong volume growth to aid, margin expansion seen on better mix

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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India’s largest passenger car manufacturer Maruti Suzuki India Ltd. will be reporting its March quarter earnings on Friday amidst some sharp moves seen in the stock recently. The stock has risen over 5% in the last one month and is up 26% so far in 2024.

A CNBC-TV18 poll expects Maruti Suzuki’s revenue growth to be in excess of 20%, while net profit is likely to grow more than 50% compared to the same quarter last year.

Maruti reported strong volume growth of 13% from last year during the January – March quarter. Total volumes for the quarter stood at 5.84 lakh units from 5.14 lakh units last year.

Volume growth in Maruti during the quarter was driven by visible traction in the utility vehicles business, which saw growth of 71% from last year. However, despite the surge in overall volumes, those for entry-level vehicles fell by 28% from year-on-year.

Maruti may report a 290 basis points expansion in its EBITDA margin to 13.4% led by stable raw material costs, improving product mix and benefits from operating leverage.

Shares of Maruti hit a record high of ₹13,066 on April 24 this year. The stock has gained 20% in the last six months and is currently trading at 28 times financial year 2025 price-to-earnings multiple.

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Maruti Suzuki shares cross ₹13,000 for the first time, extend 2024 gains to 26%

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Maruti Suzuki India Ltd., the country’s largest passenger car maker, crossed the ₹13,000 mark for the first time on Tuesday, marking a new record, ahead of its fourth quarter results on April 26.

At the day’s high of ₹13,024.50, the stock’s market capitalisation crossed the mark of ₹4 lakh crore. The stock has risen more than 26% so far on a year-to-date basis.

The March quarter is usually seasonally the best quarter for passenger vehicle players on a year-on-year and a quarter-on-quarter basis. Domestic broking firm Motilal Oswal said that the PV segment posted healthy growth of 19% YoY and 20% sequentially, whereas other segments saw a slowdown in demand.

Reiterating ‘Buy’ on the stock with a target price of ₹13,500 per share, brokerage JM Financial said it believes that rationalisation of hybrid taxation could well be a trigger for re-rating to 28 times PE (price-earnings) offering an upside of another 4% from the current market levels.

“Given MSIL is an early-mover, we believe, the company stands to benefit the most from rationalisation of Hybrid taxation,” the brokerage said.

Another brokerage Centrum, which has a target price of ₹15,082 on the Maruti Suzuki stock, expect the company’s performance to be driven by reshaping of portfolio driven by SUVs, visibility on EV entry in FY25, and consolidation of SMG.

On the charts, Maruti Suzuki’s Relative Strength Index (RSI) is now at levels of 62.8. A reading above 70 would mean that the stock is in overbought territory.

Out of the 50 analysts that track Maruti, 41 of them have a ‘Buy’ recommendation on the stock. Six of those analysts have a ‘Hold’ rating, while three still advice ‘Selling’ the counter.

Shares of Maruti Suzuki settled 1.48% higher at ₹12,975.

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Maruti Suzuki hikes prices for Swift and Grand Vitara variant

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Leading automobile maker Maruti Suzuki on Wednesday, April 10, announced a price hike of Swift and selected variants of Grand Vitara amid a rise in commodity prices. The car manufacturer has raised prices of Swift by up to ₹25,000 and Grand Vitara Sigma variant by ₹19,000.

The new prices will come into effect from today, Maruti Suzuki said in an exchange filing.

Earlier this year, Maruti Suzuki had announced a price hike across models to the tune of 0.45%, citing increased cost pressure driven by overall inflation and increased commodity prices.

The company in November 2023 had intimated its intention to increase prices of its models. “The Company has planned to increase the prices of its cars in January, 2024 on account of increased cost pressure driven by overall inflation and increased commodity prices. While the Company makes maximum efforts to reduce cost and offset the increase, it may have to pass on some increase to the market,” it had said then.

On April 9, Maruti said that it has added a new assembly line at its plant in Manesar, Haryana, which has the capability to manufacture 1 lakh units per annum.

With this additional assembly line, the total manufacturing capability at Manesar now increases to 9 lakh vehicles per annum.

Maruti operates three manufacturing plants across India. Its Gurugram plant in Haryana has a capacity of 7 lakh units per annum, while its Hansalpur plant in Gujarat can produce 7.5 lakh units per annum.

Shares of Maruti Suzuki were trading 1.67% lower at ₹12,672.20 apiece on the NSE as of 1:45 pm while the benchmark indices were trading muted with a positive bias.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow