Maruti Suzuki India Q2 Results: Higher costs, MTM losses impact margins; revenue grows 26%

Shares of Maruti Suzuki India Ltd. reported its results for the September quarter on Tuesday, October 27, which were largely in line with analyst expectations.

India's largest passenger car manufacturer reported revenue growth of 26% during the September quarter. The ₹53,340 crore figure was in line with the CNBC-TV18 poll of ₹53,350 crore.

Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for the quarter stood at ₹4,763 crore. The figure is 6.3% lower than the ₹5,085 crore reported during the same quarter last year. A CNBC-TV18 poll was working with a figure of ₹4,445 crore.

EBITDA margin during the quarter narrowed to 9% from 12% during the quarter. The number is higher than the CNBC-TV18 poll of 8.4%.

Maruti Suzuki attributed the year-on-year pressure on margins to “adverse commodity prices in the context of West Asia conflict”, “adverse foreign exchange movement” and “lower non-operating income due to mark-to-market losses on invested surplus”, according to its investor presentation.

The company said “improved realisation”, “favourable operating leverage” and “cost reduction efforts” helped offset some of the pressure.

Maruti Suzuki's net profit during the quarter stood at ₹2,455 crore, down 27% from ₹3,303 crore last year. A CNBC-TV18 poll projected the figure to be ₹2,655 crore.

Raw material costs accounted for 79.9% of net sales in the September quarter, compared with 75.7% a year earlier, although the ratio improved from 80.5% in the June quarter.

In its quarter-on-quarter comparison, Maruti Suzuki also cited “higher manufacturing overheads” and “higher depreciation expense due to new facility and new model dies” as factors weighing on margins. Lower non-operating income due to mark-to-market losses on invested surplus also affected profitability.

Volume growth during the quarter stood at 27% to 6.97 lakh units, which contributed to the topline growth for Maruti Suzuki. Volume growth during the quarter was aided by GST-led demand momentum and a low base.

Maruti Suzuki’s total income for the September quarter stood at ₹53,770 crore, compared with ₹43,298 crore in the year-ago period. However, total expenses rose to ₹50,604 crore from ₹39,008 crore a year earlier, according to the company’s standalone financial results.

The company’s profit before tax declined to ₹3,166 crore in the September quarter from ₹4,291 crore in the corresponding period last year. The results also showed that other income fell to ₹429 crore from ₹966 crore a year earlier.

Separately, Maruti Suzuki said it was currently unable to reliably estimate its financial obligations under the Environment Protection (End-of-Life Vehicles) Rules, 2025.

The rules, which came into effect on April 1, 2025, require vehicle manufacturers to fulfil extended producer responsibility obligations for scrapping end-of-life vehicles through certificates purchased from registered vehicle scrapping facilities. The company said the financial impact would be evaluated once the implementation framework and pricing mechanism for the certificates are established.

Shares of Maruti Suzuki India ended 2% higher on Tuesday ahead of the results announcement at ₹11,450. The stock is down nearly 32% so far this year.

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