Maruti Suzuki, the country’s largest car maker, shocked the Street on Tuesday by reporting a 9.7 per cent fall in standalone net profit at Rs 1,166 crore in the fourth quarter (January-March), belying a market’s consensus estimate of Rs 1,699 crore.

The unexpected fall after two strong quarters in a Covid-battered year was blamed on a surge in commodity prices and lower non-operating income as a result of mark-to-market losses on surplus investments. Other income tumbled by almost 90 per cent to Rs 89.8 crore.

The auto maker had reported a net profit of Rs 1291.7 crore in the year-ago quarter.

Revenues from operations rose by 32 per cent to Rs 24,023.7 crore from Rs 18,198.7 crore. On a sequential quarter basis, it was up 2.4 per cent from Rs 23,457.8 crore.

On a consolidated basis, the net profit dipped 6.1 per cent to Rs 1,241.1 crore.

“With this second Covid wave, the demand for personal transport will, if anything, strengthen, not weaken. More and more people will want to have their personal transport,” Maruti Suzuki chairman R.C. Bhargava told reporters.

He said the company was keeping a close watch on the impact of rising steel prices and government orders limiting the use of oxygen by industries which had made it difficult for the auto maker to provide a sales outlook for the current fiscal. But he was quick to add that he expected to see growth this year.

Maruti has also been badly hit by the shortage of semiconductor chips which has forced car makers to slash production. Bhargava said he expected the crisis to continue for some time but refused to amplify.
Maruti Suzuki sold 492,235 vehicles in the March quarter, up 28 per cent year on year.

“Sales in the domestic market stood at 456,707 units, growing by 26.7 per cent. Exports were at 35,528 units, higher by 44.4 per cent. It may be recalled that in Q4 of FY20, there was a significant decline in the sales volume largely owing to Covid-19 lockdown,” the company said.

For the full year, the carmaker reported sales of 1,457,861 units, lower by 6.7 per cent compared with the previous year. In FY21, the sales in the domestic market stood at 1,361,722 units, down 6.8 per cent while exports were at 96,139 units, down 5.9 per cent year on year.

Full-year revenues declined 7.2 per cent on year to Rs 66,562.1 crore, while net profit declined by 25.1 per cent to Rs 4,229.7 crore due to the Covid-19 pandemic, the company said in a statement.