Double-digit growth and positive sentiments on the back of a festive season and above-average monsoon helped auto manufacturers to post impressive revenue and profit for the second quarter of the current fiscal year.
Helped by double-digit sales growth, the country’s biggest carmaker Maruti Suzuki reported a record profit of Rs 2,398 crore during the quarter ended September 30, up by 60 per cent increase over the same quarter last year.
Maruti Suzuki's income from operations rose 29.28 per cent to Rs 20,296.8 crore during the quarter from Rs 15,699.7 crore in the year-ago period.
Maruti Suzuki Chairman R.C. Bhargava said, "It has been in many ways best quarter we have ever had."
He added the company's profitability was driven by high capacity utilisation and robust sales.
"When you have capacity utilisation like we have now, every extra car we make adds to profit because of reduced overheads, including depreciation," Bhargava said.
The country’s largest two-wheeler manufacturer Hero saw a jump of 27.74 per cent to Rs 1004.22 crore on the back of record two wheeler sales.
Hero Motocorp sold 18.23 lakh units in Q2, higher by 15.8 per cent over 15.74 lakh units sold in year-ago period due to strong demand for new scooter models.
Hero’s total income grew to Rs 8,601.10 crore in Q2 September 2016 over Q2 September 2015, a rise of 15.33 per cent.
Pawan Munjal, chairman and managing director of Hero MotoCorp, said the highest-ever volume sales during the quarter is a reiteration of the overwhelming customer preference of the company's products.
The country’s third largest two-wheeler maker Bajaj Auto Ltd reported a 7.2 per cent increase in consolidated net profit at Rs 1,200.72 crore for the second quarter ended 30 September. The company had posted a consolidated net profit of Rs1,120.04 crore in the same quarter of last fiscal.
Total income from operations during the quarter under review was marginally up at Rs 6,432.32 crore as against Rs 6,407.54 crore. Unit volume sales during the quarter were at 10,31,945 units as against 10,56,596 units in the year-ago period, down 2.33 per cent.
Two-wheeler and three-wheeler maker TVS Motor Company's profit during July-September quarter jumped 33.4 per cent to Rs 177.4 crore on strong revenue growth.
Revenue during the quarter grew by 20.6 per cent to Rs 3,726.3 crore compared with year-ago period as its two-wheeler sales increased 23.1 per cent to 7.95 lakh units.
"Motorcycles sales grew by 30.2 per cent year-on-year to 3.32 lakh units and scooter sales increased to 2.29 lakh units in Q2FY17 against 2.18 lakh units in Q2FY16, registering a growth of 5 per cent," TVS Motor said.
BW Reporters
The author is Senior Correspondent with BW Businessworld
