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<ul><li>Maruti Suzuki has announced its Q2 FY20 earnings</li><li>Maruti profits fall by 39.3% as compared to the same quarter in the previous year.</li></ul>India’s largest car manufacturer Maruti Suzuki’s second quarter profits fell by 39.3% to ₹13,586 million from ₹22,404 million in the same quarter last year. <br /><br />Its total revenue from operations stood at ₹169,853 million. <br /><br />
  
  
  
  
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<br />As the quarter reports came in, the shares of Maruti Suzuki fell by 1.68%. <br /><br />In the past one month, Maruti Suzuki's share price has increased as the public sentiment has expected better results from the festive season sales. <br /><br />
  
  
  
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 <br />When the last quarter results were announced on July 26, its share price gained over a percent immediately after the company’s earnings report because the performance was better than expected.<br /><br /><strong>Second quarter woes</strong><br /><br />In the second quarter, its worries only worsened from the first quarter. Its sales fell by 24% in September as compared to the same month last year. It sold a total of 122,640 units during the month. <br /><br />
  



  
  
  
  
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<br />In August, it had also slashed 3,000 contractual jobs as it had cut production. <br /><br />Maruti was expecting some traction as it started offering discounts across multiple car models during the the festive season. <br /><br />In September, Maruti Suzuki also slashed prices to align with the government’s plans to revive demand. It reduced the price of select models like Alto 800, Alto K10, Swift Diesel, Celerio, Baleno Diesel by ₹5,000. <br /><br /><strong>Maruti’s performance in the first quarter</strong><br /><br />As the car slowdown hit the country’s automobile segment, almost every other manufacturer saw its profits fall in the first quarter of the current financial year. <br /><br />Maruti Suzuki’s first quarter sales fell 14% and profits fell by nearly twice as much, 27.3%. The total car sales for the first quarter had fallen by 17.9% as compared to the same quarter in the previous year. <br />

Maruti Suzuki profits fall by 39.3% for the second quarter

<ul><li><keyword id="44883" type="CITY" weightage="20" keywordseo="Maruti-Suzuki">Maruti Suzuki</keyword> announced its earnings report for the first quarter of FY20. </li><li>Its profits have declined by 27.3%.</li><li>However, the company has managed to perform better than the market estimate. </li></ul>India’s largest car maker Maruti Suzuki’s first quarter sales fell 14% and the profit fell by nearly twice as much, 27.3%.<br /><br />But the share price gained over a percent immediately after the company’s earnings report because the performance was better than expected. <br /><br />Over the past few months, car sales have been woefully slow in India, which had led to a lot of talk on performance of auto manufacturers for the quarter. <br /><br />CLSA, the capital markets research firm, had predicted that its first quarter profits could decline by 35-40%.<br /><br />Maruti Suzuki, just like its peers, has been reporting its declining sales every month, which also led to the car manufacturer lose its stock market price. The depleting fortunes in India cost the company’s Japanese partner Suzuki <a href="https://www.businessinsider.in/suzuki-earnings-estimate-cut-as-marutis-india-sales-fall/articleshow/70128693.cms">$2 billion</a> in market capitalisation in just two days.<br /><br />
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<br /><br /><table style="border-width: initial; border-style: none; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;"><br /></td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;">Q1 FY20<br /><br /></td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;">Q1 FY19<br /><br /></td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;">Total car sales<br /><br /></td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;">402,594<br /><br /></td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;">490,479<br /><br /></td></tr></tbody></table><br />Maruti Suzuki said that a number of factors like higher depreciation expense, lower capacity utilisation, adverse commodity prices and higher sales promotion expense, impacted its results. Going forward, the company hopes that a strong product portfolio and commodity prices will help them get back on track.<br />

India’s largest car maker Maruti Suzuki battles sales slowdown – profit beats street estimates

<ul><li><strong>The Japanese car making giant has been hit by severe slowdown in car sales in India.</strong></li><li><strong>Suzuki shares have lost over a sixth of its share value this year due to the fear of depleting earnings.</strong></li><li><strong>Maruti accounts for over 52% of Suzuki’s global sale volumes.</strong></li></ul>India’s largest car maker Maruti Suzuki has cut production for eight months in a row due to lack of buyers. The depleting earnings for Maruti is affecting its Japanese parent Suzuki, who just announced a nearly 40% cut in its estimate for operating income this year.<br /><br />The shares of Maruti fell over 2% immediately after the announcement from Suzuki. "The Company hereby revises the consolidated business forecast due to decrease in Japan production in the course of restructuring final inspection scheme, slowdown in Indian automobile market, and exchange rate fluctuations," <a href="https://www.release.tdnet.info/inbs/ek/140120191010406987.pdf" data-type="tilCustomLink" target="_blank">Suzuki said in a filing</a> with the stock exchanges in Tokyo.<br /><br /><table style="width: 188pt;"> </colgroup>  <tbody><tr> <td class="xl63" style="height:15.0pt;width:101pt"><strong>March 2020 Forecast</strong></td> <td class="xl63" style="border-left-width: initial; border-left-style: none; width: 87pt;"><strong>Cut</strong></td> </tr> <tr> <td class="xl64" style="height: 15pt; border-top-width: initial; border-top-style: none; width: 101pt;">Net sales</td> <td class="xl65" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none; width: 87pt;">10.30%</td> </tr> <tr> <td class="xl64" style="height: 15pt; border-top-width: initial; border-top-style: none; width: 101pt;">Operating income</td> <td class="xl65" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none; width: 87pt;">39.40%</td> </tr> <tr> <td class="xl64" style="height: 15pt; border-top-width: initial; border-top-style: none; width: 101pt;">Ordinary income</td> <td class="xl65" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none; width: 87pt;">35.30%</td> </tr> <tr> <td class="xl64" style="height: 15pt; border-top-width: initial; border-top-style: none; width: 101pt;">Net income </td> <td class="xl66" style="border-top-width: initial; border-top-style: none; border-left-width: initial; border-left-style: none; width: 87pt;">30%</td> </tr></tbody></table><br />Brokerage house CLSA has maintained a 'buy' rating on Maruti Suzuki with a target price of ₹7,950 over the next 12 months hoping that the new models will lure some buyers who are still on the fence.<br /><br />The slowdown in car sales is not unique to Maruti. Car sales in India fell 20.5% in September compared to a year earlier. Aside from the economic slump in India, car buyers have shied away from showrooms expecting duty cuts and lower prices as well as fearing a loss of value for their new cars when the new emission norms kick in next year.<br /><br />This has been a debilitating blow for Suzuki for whom India makes for <a href="https://economictimes.indiatimes.com/industry/auto/maruti-continues-to-drive-suzukis-global-growth-story/articleshow/67860711.cms?from=mdr">over half of all its global sale volumes</a>. “In view of the current sales environment, we lower our estimates for India domestic sales to +0.2% for FY2019 (from +5.4%) and +3.7% for FY2020 (+6.4%),” JPMorgan said in a report in June. <br /><br />The steady decline in  car sales in India has been the worst in 18 years, according to the Society of Indian Automobile Manufacturers (SIAM). In September 2001, after the tech bubble burst plunging the global economy into a temporary crisis, the sales had dropped down by 21.91%.<br /><br />In rural India, the decline in demand for cars is attributed to a protracted farm crisis, made worse by the ongoing water crisis and deficient monsoon in many parts. This has had a significant impact on Maruti, which has a deeper reach and penetration outside the big cities too. <br /><br />People in India increasingly prefer cab aggregators like Ola and Uber, or even <a href="https://www.businessinsider.in/cars24-used-cars-startup-could-soon-turn-profitable-will-breakeven-by-december-2019/articleshow/69993448.cms">second hand cars to new ones</a>. <br /><br /><strong>SEE ALSO:</strong><br /><a href="https://www.businessinsider.in/business/corporates/news/mahindra-suvs-and-pick-up-trucks-are-a-rage-in-south-africa-even-in-a-shrinking-market/articleshow/71518308.cms" data-type="tilCustomLink" target="_blank">Mahindra SUVs and pick-up trucks are a rage in South Africa even in a shrinking market</a><br /><a href="https://www.businessinsider.in/union-budget-2019-indian-government-announces-tax-subsidy-for-purchasers-of-electric-vehicles/articleshow/70091003.cms">Tata Motors, Maruti, Mahindra will benefit from tax deductions on electric vehicles</a><br /><a href="https://www.businessinsider.in/cars24-used-cars-startup-could-soon-turn-profitable-will-breakeven-by-december-2019/articleshow/69993448.cms">EXCLUSIVE: Cars24 is racing towards profitability as Indians choose used cars over new ones</a><br /><a href="https://www.businessinsider.in/tata-motors-jaguar-land-rover-moodys-downgrade/articleshow/69889499.cms">Jaguar Land Rover is dragging Tata Motors along in its downward spiral</a><br /><br /><br /><br /><br /><br /><br />

Suzuki just slashed its operating income forecast by 40% citing slower sales in India

Greater Noida, Feb 7 () Maruti Suzuki on Friday launched the BS VI-compliant version of its multi purpose vehicle Ertiga in CNG, priced at Rs 8.95 lakh (ex-showroom New Delhi) here. <p>Ertiga S-CNG, which offers a mileage of 28.06 km/kg is second BS VI compliant S-CNG vehicle and the only MPV with factory-fitted CNG in the country, from Maruti Suzuki, the company said. </p><p>"Ertiga has been a market leader amongst MPVs, and the introduction of BS6 S-CNG will further help augment its leadership in the segment, " Maruti Suzuki India Limited's director for sales and marketing, Shashank Shrivastava said. </p><p>The company has sold over 5.28 lakh units of Ertiga since its launch in India in 2012.</p><p>Being the first company to introduce factory-fitted CNG cars in the  country, Maruti Suzuki owns the largest portfolio of green vehicles, he said. </p><p>The launch of  S-CNG vehicle range is aligned to and complements the Government's vision of reducing oil import and enhancing the share of natural gas in the energy basket of the country from 6.2 per cent now to 15 per cent by 2030, the company said. </p>Maruti Suzuki S-CNG vehicles are equipped with dual inter-dependent ECUs (electronic control units) and intelligent injection system.  IAS  MRMR

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Maruti Suzuki profits fall by 39.3% for the second quarter

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India’s largest car maker Maruti Suzuki battles sales slowdown – profit beats street estimates

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Suzuki just slashed its operating income forecast by 40% citing slower sales in India

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Maruti Suzuki launches BS-VI compliant CNG version of Ertiga

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