India's largest automaker, Maruti Suzuki is on a roll this financial year and in the just concluded third quarter the company reported a growth of 12.4 per cent by selling over 4 lakh units in the domestic market. During the third quarter, Maruti Suzuki registered Net Sales of Rs. 18940 crore, up 13.9 per cent over the same period previous year.
Company's operating profit stood at Rs 3037.8 crore, a growth of 22.1 per cent over the same period previous year. Maruti Suzuki says that higher sales volume paired with cost reduction efforts and lower sales promotion expenses along with forex benefit benefitted the company. Maruti Suzuki's net profit in third quarter of this ongoing financial year (2017-18) stood at Rs 1799 crore, up 3 per cent compared to the same period last year.
In a statement Maruti Suzuki further said, "while the operating profit increased by 22.1 per cent, the net profit increased by 3 per cent due to increase in effective tax rates and lower non-operating income due to mark-to-market impact on the invested surplus, compared to last year."
In the board meeting, the company seems to have reached on a new agreement in paying royalty to its parent company Suzuki. The Board discussed and approved a revision in the method of calculating royalty which would result in lower royalty payments for new model agreements starting the Maruti Suzuki Ignis. This would be implemented after approval by the Board of Suzuki Motor Corporation said the company in a statement.
Overall in the financial year, Maruti Suzuki sold a total of 1,317,801 vehicles in the first nine months, a growth of 14.2 per cent. Sales in the domestic market stood at 1,226,418 units a growth of 15.5 per cent. Exports were at 91,383 units.
The Company’s net sales stood at Rs 57510.5 crore in April-December 2017-18, a growth of 17.6 per cent over the same period last year.
The operating profit was Rs 9046.5 million, a growth of 16.4 per cent over the same period previous year on account of higher sales volume, favourable product mix, cost reduction efforts and forex benefit and partially offset by adverse commodity prices.
Net profit stood at Rs 5839.7 crore, up 3.6 per cent.
Maruti Suzuki's operating profit increased by 16.4 per cent while the net profit increased by 3.6 per cent due to increase in effective tax rates and lower non-operating income due to mark-to-market impact compared to last year.