Maruti’s net profits in Q3 down 63 percent

Maruti Suzuki recorded net sales (net of excise) of Rs 7,663 crore, a fall of 17.4 percent over same period in the previous year. Net profits in the third quarter stood at Rs 205 crore, a fall of 63.6 percent. In Q3, the company sold 211, 803 units in the domestic market as compared to 299, 527 units same period in the previous year.

On the export front, 27, 725 units made their way to overseas destinations as compared to 31,160 units in the previous year. Sales in Q3 were affected by sluggish buyer sentiment as a result of higher petrol prices and interest rates. More importantly, Maruti lost output of around 40,000 units due to the strike that crippled its operations at Manesar plant for most of October 2010, the Diwali season when typically, car sales do well. This affected sales of the all-new Swift, launched in July.

The depreciation of the rupee during the quarter adversely impacted the bottom line through higher cost of imports for both the company and its vendors, and in outgoings due to royalty payments. With the labour issue now resolved, Maruti has seen sales of the Swift go up with 17,273 and 16,375 units sold in November and December 2010 respectively.

In the last quarter of the current financial year, Maruti is slated to export the Ertiga MUV to Indonesia, its first export market. The company is also working on the 800 replacement which is likely to be launched in the first quarter of 2012-13.