Maruti Suzuki India
Credit: DH Photos
Maruti Suzuki, India's top carmaker by sales, missed quarterly profit estimates on Wednesday, due to a one-time charge related to the country's new labour codes even as revenues topped estimates helped by tax cuts and festive demand.
Maruti kicks off the earnings season for Indian automakers in a quarter when car sales hit a record high thanks to tax cuts that made most models more affordable.
The company, India's largest manufacturer of small cars, was among the biggest beneficiaries of the tax cuts, with domestic sales rising 22 per cent, led by a 26 per cent jump in small-car dispatches.
The Swift manufacturer reported a profit of 37.94 billion rupees ($413.5 million) for October-December, up from 35.25 billion rupees a year before, but fell short of analysts' expectation of 42.61 billion rupees, per data compiled by LSEG.
The results included a one-time charge of 5.94 billion rupees tied to India's newly-enacted labour codes.
Maruti's overall sales, which include exports and sales of models to Toyota under a global manufacturing and design partnership, grew nearly 18 per cent from a year earlier.
This helped boost revenues at the carmaker, majority-owned by Japan's Suzuki Motor, by nearly 29 per cent to 498.92 billion rupees, beating analysts' expectation of 495.93 billion rupees.
Shares of the company were down 2.3 per cent, little changed from before the results.