A tighter control over costs and higher export volumes have allowed Hyundai Motor India (HMIL) to report a 14% year-on-year growth in net profit in the second quarter of FY26, though revenue growth was subdued at just 1%. The maker of Creta and Venue models posted Rs 1,572 crore in consolidated net profit, beating the Bloomberg estimate of Rs 1,507 crore. Its consolidated revenue at Rs 17,155 crore was below the estimate of Rs 17,638 crore.
Hyundai’s Ebitda (earning before interest, tax, depreciation and amortisation) margin rose by 110 basis points to 13.9% as against 12.8% in the same quarter last year. The company’s stock traded flat on the BSE at the time of announcement of results but ended the day with a gain of 2.4%, though the Sensex dipped by 0.7%.
Hariharan KS, head of investor relations, HMIL said, “The improved margins can be attributed to favourable product and export mix, coupled with cost reduction efforts. On a sequential basis the key margin drivers were better volumes and product mix among others.”
The rise of 22% in exports helped Hyundai offset the fall in volumes in the domestic market which contracted by 7% during the reporting quarter. Its total volumes dipped 0.5% to 190,921 units. Exports, which generate better margins than domestic sales, was 27% of the total volume.
With production commencing in its Pune plant this month, the incremental cost impact may weigh on HMIL’s profitability in the near term. “However, we are confident that we will minimise the above impact and secure healthy margins through better operating efficiencies and cost control measures,” Unsoo Kim, managing director, HMIL said.
Company officials said the upcoming updated Venue, which debuts on November 4, will help it sustain the demand momentum next month and in December. The Venue will compete against the segment best-sellers Tata Nexon, Maruti Suzuki Brezza, Kia Sonet, and Skoda Kylaq among others.
“Commodity cost during the last quarter saw some increase in a few items. But we were able to keep the cost under check due to cost optimisation efforts. We are expecting some increase in the third quarter in some of the commodities,” Hariharan added.
In the middle of this month, Hyundai said it would make fresh investments of Rs 45,000 crore that would deliver 26 products by 2030, including electric and hybrid vehicles.