In a year ravaged by Covid-19, India’s biggest automobile company managed to turn a decent profit, despite a year-on-year decline. Maruti Suzuki sold 14.5 lakh vehicles during 2020-21, a drop of just 6.7 per cent compared to the previous financial year. Of this 13.6 lakh were sold in the domestic market.
This translated into net sales of more than Rs 66,000 crore and a net profit of Rs 4,229 crore. Both figures are less compared to last year, sales lower by 7.2 per cent and profit decreasing by 25 per cent.
A Maruti statement released Tuesday afternoon blamed the decline on account of lower sales volume, increase in commodity prices, adverse forex movement and lower non-operating income partially offset by lower operating expenses and cost reduction efforts. For an unprecedented nearly two months, no auto sales took place in the country due to the national lockdown in the summer of last year.
The results would bring in mixed feelings to the Gurugram auto giant as well as the Indian automobile sector as a whole. While a decline was expected due to the lockdown and the pandemic, the quick auto sales recovery had infused optimism to not only the sector but the whole of the economic sphere. Testament to that is the company’s fourth quarter (January to March 2021) results which were also announced simultaneously; the company registered growth in sales at 26.7 per cent as well as income at 33.6 per cent. However, the drop in profits, lower by 9.7 per cent at Rs 1,250 crore compared to the same period last year, would come as a concern.
Maruti’s board of directors met and recommended a dividend of Rs 45 per share (face value of 5 rupees per share) for the financial year 2020-21. An official communique billed it “in line with the financial performance of the year and considering uncertain business environment.”