On the back of a set of strong March quarter numbers, automaker Maruti Suzuki bucked the trend in Monday’s trade. While the 30-share Sensex lost nearly 1% of its value, shares of Maruti rallied as much as 4% after its quarterly results exceeded street estimates. The stock ended the session at R3646.70, up 3.02%. On the BSE the counter clocked in volume of 1.87 lakh shares; more than seven times last two week’s average trading activity of 25,000 shares.
The domestic car-maker reported a 61% jump in its y-o-y net profit to R1,284 crore while for the fiscal 2014-15 it reported its highest ever annual profit of R3711.2 crore. Higher volumes were the key reason behind the strong quarterly performance, also as the share of first time car buyers in its total sales jumped from 37% to record 44%.
Maruti’s decision to declared highest ever dividend in the quarter also seem to have supported the buying interest in the stock. The company announced a 500% dividend of R25 per share compared to R12 last year. The dividend outgo at R755 crore equals 20% of net profit for the year.
Notwithstanding the strong March quarter performance, the management sounded cautious on FY16 rural demand. Due to unseasonal sales and weak monsoon expectations, it is not too optimistic on the rural sales in the year in which the company sees 10-11% volume growth.
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