Maruti Suzuki India on Saturday reported a 20.25 per cent decline in its net profit at Rs. 465.36 crore for the quarter ended June 30, 2010. However, the carmaker's income during the quarter increased by 27 per cent to Rs. 8,231.53 crore.
“The drop in net profit is due to higher commodity prices, increase in royalty and lower other income. In addition, income from exports to Europe fell due to weakening of the euro,” the company said in a statement. Cost of raw materials went up to Rs. 6,079.72 crore from Rs. 4,827.34 crore in the year-ago period. Other income during the April-June period declined to Rs. 100.20 crore from Rs. 216.53 crore.
Notably, this is the first time in the last five quarters that the company has reported a decline in its net profit after record-breaking sales figures in 2009-10.
During the quarter, the company's market share also declined to 47.59 per cent from over 55 per cent in the 15 lakh-units per annum domestic passenger car segment. It sold 2.06 lakh units during the quarter in a total market of 4.34 lakh units.
“Following regulatory amendments, the company has, during the quarter, accrued for royalty expense in accordance with the various royalty agreements entered into with Suzuki Motor Corp resulting in an additional royalty expense of Rs. 188.70 crore, including Rs. 65.15 crore for the period December 16, 2009, to March 31, 2010,” it added.
