JOIN USMaruti to expand capacity by 10L units
India’s largest carmaker Maruti Suzuki on Wednesday announced that it will expand production capacity by 10 lakh vehicles a year to meet growth in demand, including exports.
“In light of the estimated market demand including exports, the board in principle approved the creation of additional capacity of up to one million vehicles a year,” Maruti Suzuki said in a statement.
The company’s total existing capacity is around 13 lakh units in Manesar and Gurugram. “The existing capacity of 13 lakh units is fully utilised,” Maruti Suzuki said in a regulatory filing.
In addition to this, the company has access to 7.5 lakh units from parent Suzuki Motor’s facility in Gujarat. Maruti Suzuki gets supply of vehicles by Suzuki Motor Gujarat Pvt Ltd under a contract manufacturing agreement.
On investment required for the proposed capacity expansion, Maruti Suzuki said it will be “finalised and approved by the Board while framing the phases of installation of capacity”.
The company plans to finance the new capacity addition through “internal accruals”.
Despite the shortage of electronic components, Maruti Suzuki claimed that it recorded its highest-ever annual sales volume in 2022-23. The annual turnover of the company surpassed the Rs 1 lakh crore mark in the fiscal ended March 2023.
The company sold 19,66,164 vehicles during the fiscal 2022-23 despite missing production of about 1,70,000 units due to shortage of electronic components. This translated to a growth of 19% over FY 2021-22 sales volume of 16,52,653 vehicles.
Sales volume in the year comprised 17,06,831 units in the domestic market and highest-ever exports of 2,59,333 units. The company’s net sales value jumped to Rs 1.12 lakh crore in the financial year ended March 2023 from Rs 83,798 crore in the previous year.
The company sold 5,14,927 vehicles during the January-March quarter, which is 5.3% higher when compared to the corresponding period of the previous year.
Maruti Suzuki’s profit after tax surged by 42.6% to Rs 2,623.6 crore in the quarter ending March 31, 2023 as compared to Rs 1,838.9 crore recorded in the same quarter last year.
For the full year 2022-23, the company’s net profit more than doubled to Rs 8,049.2 crore.
The company’s board has approved a dividend of Rs 90 per share for the financial year 2022-23. The date of payment of dividend is September 6, 2023 subject to the approval of the shareholders in the ensuing annual general meeting, Maruti Suzuki said.