Maruti Suzuki India Shares Turn Flat

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Maruti Suzuki India Shares Turn Flat Ahead Of Second Quarter Results

Maruti had reported a consolidated net profit of Rs 475 crore during the June quarter.

New Delhi: Shares of India’s largest carmaker Maruti Suzuki India were trading flat on Wednesday ahead of its second quarter results, ending September 30, for the current financial year 2021-22 (Q2 FY22).

Shares of Maruti marginally fell as much as 0.07 per cent to Rs 7,295.30 on the BSE index in late morning deals amid a volatile trade. On NSE, the stock edged 0.06 per cent lower to Rs 7,292.90.

The auto major had reported a consolidated net profit of Rs 475 crore for the first quarter ended June 30 (Q1 FY22). The company’s production and sales in the first quarter were impacted due to the second wave of the Covid-19 pandemic in the country.

Maruti had posted a net loss of Rs 249.4 crore — its first quarterly loss since July 2003 — in the June quarter last year (Q1 FY21) due to a nationwide lockdown imposed to curb the coronavirus spread.

The carmaker’s sales had declined 46.16 per cent to 86,380 units in September this year “due to shortage of electronic components”.

Maruti stated that its domestic sales had slipped 54.9 per cent to 68,815 units last month as against 1,52,608 units in September 2020.

Booming demand for consumer electronics and supply chain disruptions across the globe have led to an acute shortage of chips, forcing a number of car companies to drastically cut production as they try to secure limited semiconductor supplies.

Due to the problems in the industry, automakers are focussing on making high margin models and have passed on some of the costs to customers.

Major carmakers in India, including Maruti, Tata Motors and Mahindra, have increased prices multiple times in 2021.

Automobiles have become increasingly dependent on chips – for everything from computer management of engines for better fuel economy to driver-assistance features.

The global chip shortage crisis has forced many to curtail the production of less profitable vehicles.

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