Maruti posts best ever annual profit riding on record sales

Driven by record sales, the country's largest car maker Maruti Suzuki India today reported its highest ever annual profit of Rs 3,711.2 crore in the fiscal year ended March 31, 2015.

The company, which had posted an annual net profit of Rs 2,783.05 crore in 2013-14, -- its previous best-- said it expected 10-11 per cent growth in volume terms in the ongoing fiscal.

Net sales in FY 2015 also stood at a record high of Rs 48,605.53 crore, up 13.97 per cent from Rs 42,644.76 crore in the 2013-14.

The company also recorded its highest ever volume sales in a fiscal at 12,92,415 units, up 11.9 per cent from the previous fiscal. Of this, exports were at 121,713 units, a gain of 20.1 per cent, the company said.

Buoyed by the performance, the company said its Board of Directors recommended a dividend of 500 per cent, Rs 25 per share of face value Rs 5 for 2014-15. The dividend in 2013-14 was at 240 per cent, Rs 12 per share of face value Rs 5.

"The major cause for increase in profit has been partly higher volumes. To a large extent what has helped is lower material cost and favourable foreign exchange, as well as from lower commodity prices," Maruti Suzuki India Chairman R C Bhargava told reporters here.

Royalty rate has also come down due to favourable foreign exchange rate factor, he added.

For 2014-15, total royalty paid to parent Suzuki was Rs 2,788 crore, which is 5.7 per cent of net sales. In the previous fiscal, it was Rs 2,604 crore, 6.1 per cent of net sales.

For the quarter ended March 31 2015, the company reported 60.5 per cent jump in net profit at Rs 1,284.2 crore.

The company had posted a net profit of Rs 800.05 crore in the same period last fiscal.

Higher volumes, material cost reduction initiatives, favourable foreign exchange and lower sales promotion expenses contributed to the bottom-line during the quarter, the company said.

Net sales during the quarter stood at Rs 13,272.6 crore, up 12.3 per cent as against Rs 11,818.13 crore in the same period of previous fiscal.

Volume sales in the quarter were up 6.7 per cent at 3,46,712 units, the company said adding exports were at 29,542 units, at a growth of 12.4 per cent.

On the outlook, Bhargava said: "The environment, fuel prices are low, inflation is low but a reason of concern is the sluggish economy. Our estimate is 10-11 per cent growth in volume terms for current fiscal."

Shares of Maruti Suzuki India ended the day at Rs 3,646.70 per scrip, up 3.02 per cent from the previous close on the BSE.