Maruti Buys Land in Gujarat; Stock Dips

• Maruti Suzuki to acquire land in Gujarat for capacity expansion.
• Expansion aims to add 1 million units to existing 2.6 million.
• ₹4,960 crore investment via internal funds and borrowings approved.

Maruti Suzuki India Ltd. on Monday, January 12, said its board has given its approval to acquire land for the expansion of production capacity at Khoraj Industrial Estate from Gujarat Industrial Development Corporation.

The automaker said its existing capacity is fully utilised. Its total existing capacity is around 24 lakh units per annum in Gurugram, Manesar, Kharkhoda

and Hansalpur, with a capability to produce 26 lakh units per annum. This includes the units produced at the Suzuki Motor Gujarat Pvt Ltd., which has been amalgamated with the company, it said.

The proposed capacity addition is up to 1 million units. The board will finalise and approve the same while framing the phases of installation of capacity.

The cost of land acquisition, development and preparatory activities approved by the board is ₹4,960 crore, Maruti Suzuki said.

The mode of financing will be internal accruals and external borrowings.

The capacity expansion is due to growth in market demand, including exports, it added.

Shares of Maruti Suzuki India Ltd. were trading 1% lower at ₹16,345 apiece around 11 am on Monday. The stock has gained 42% in the past year.

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