Maruti Suzuki India Limited - QTRLY RESULTS - Q3 FY 2012 - Q/E DEC,2011 -NET SALES DOWN 17.24%; NET PROFITS DOWN 63.62% YoY

Maruti Suzuki India Limited

NSE Symbol        MARUTI

MARUTI SUZUKI INDIA LTD  has declared dismal results – as expected.  But, the extent of down fall in terms of Net Profits is more than expected.

Maruti has blamed the sluggish sales on Higher fuel prices and Interest rates.

Net Sales at Rs.7717.87 cr in Q3 FY 12 is higher by 1.88% from Q2 FY 12 but lower by -17.24% fromQ3 FY 11.

Total Expenditure        is Rs.7764.12 cr – up by 2.11% from Q2 FY 12 and lower by -12.07 from Q3 FY 11.

Profit from Operations stands at Rs.118.28 cr – a heavy fall of -48.08% from previous qtr and   -82.21% from corresponding Qtr.

Profit before tax  stands at Rs.261.30 cr – down by  -21.92% from Q2 FY 12; and down by         -67.04% from Q3 FY 11.

Tax expense at Rs.55.68 cr is down by  -40.89% from Q2 FY 12 and down by  -75.53% from Q3 FY 11.

Net Profit stands at Rs. 205.62 cr – down by -14.48% from Q2 FY 12 and down by -63.62% from Q3 FY 11.

On a face value of Rs.5, Basic EPS stands at Rs.7.12 in Q3 FY 12; Rs. 8.32 in Q2 FY 12 and Rs.19.01 in Q1 FY 12.

The question is – will the 4^th quarter be Better? 

Fuel Prices will not come down – but can be expected to go up. Interest Rates will depend on RBI? There is are great expectations from RBI that it will now address Growth concerns by significantly reducing Interest Rates. The initiative displayed in pushing up Interest Rates 13 times in a year – is not evident in reducing the same now. Unfortunately, in India, Inflation is not much dependent on RBI’s Interest Rates – but Growth in several sectors is dependent on them.

Inflation is moving up and down, based on its own momentum and factors other than Interest Rates. But, interest rates do directly correlate with growth and Production in several sectors like Auto and Housing – and demand in these areas is falling due to High Interest Rates, as Maruti also has acknowledged.

Current MP of Maruti Share of FV Rs.5  is Rs.1169.90 while the 52 week high price  is Rs.1341.60 and the 52 week low price  is Rs.900.

Assuming the current trend to continue in Q4, the annual EPS will be at Rs.41.57. The PE Ratio will be 28.15. If the Industrial relations at Maruti improve and RBI relents from its tough stand on Inflation – Maruti’s fortunes may improve in Q4.

RESULTS TABLE

Maruti Suzuki	31-Dec-11	30-Sep-11	%dif1	30-Jun-11	31-Dec-10	%dif2
Net Sales	771787	757541	1.88	836147	932613	-17.24
Other Operating Income	16453	25621	-35.78	16783	16832	-2.25
Increase in SIT/WIP	-11853	9549	-224.13	-15272	14975	-179.15
Raw Materials	599531	564965	6.12	650235	695903	-13.85
Traded Goods	36648	41141	-10.92	34210	33672	8.84
Employees Cost	20902	19946	4.79	17935	23245	-10.08
Depreciation	29893	26637	12.22	24247	23694	26.16
Other Expenditure	101291	98142	3.21	84382	91471	10.74
Total Expenditure	776412	760380	2.11	795737	882960	-12.07
Profit from OperationS	11828	22782	-48.08	57193	66485	-82.21
Other Income	16037	11774	36.21	18007	12827	25.03
Interest	1735	1092	58.88	575	36	4719.44
Profit before tax	26130	33464	-21.92	74625	79276	-67.04
Tax expense	5568	9420	-40.89	19702	22759	-75.53
Net Profit	20562	24044	-14.48	54923	56517	-63.62
Face Value (In Rs	5	5	0	5	5	0
Paid Up Equity	14446	14446	0	14446	14446	0
Basic EPS	7.12	8.32	-14.42	19.01	19.56	-63.6
Public Shareholding (%)	45.79	45.79	0	45.79	45.79	0

OTHER DETAILS

Q3: Oct-Dec (2011-12 Vs 2010-11)

Ø  The Company registered Net Sales (net of excise) of Rs. 76,636 Million, a decline of 17.4 per cent over same period in the previous year.

Ø  Net Profit during the quarter stood at Rs 2,056 Million, a fall of 63.6 per cent.

Ø  During the Quarter, the Company sold 211, 803 units in the domestic market as compared to 299, 527 units same period previous year.. In exports, the Company sold 27, 725 units against 31,160 units in the previous year.

Ø  Unit sales in the Quarter were impacted by sluggish market conditions caused by higher fuel prices and interest rates. Additionally, the Company lost around 40,000 units in production due to the industrial relations problem at Manesar.

Ø  The depreciation of the Rupee during the Quarter adversely impacted the bottom-line through higher cost of imports for the Company and its vendors and royalty.

9 Months: Apr-Dec (2011-12 Vs 2010-11)

Ø  The Company registered Net Sales (net of excise) of Rs. 235, 210 Million, a decline of 10.4 per cent over same period in the previous year.

Ø  Net Profit during the period stood at Rs 9.953 Million, a fall of 38.9 per cent.

Ø  During this period, the company sold 684,892 units in the domestic market as compared to 820,350 units during same period in last year. In exports, the Company sold 88, 469 units.

Maruti Suzuki Sales in December 2011

Maruti Suzuki India Limited sold a total of 92,161 vehicles in December, 2011. This includes 14,686 units for export. The company had sold a total of 99,225 in December 2010.

The company was closed for its bi-annual maintenance shutdown for 6 days during December 2010, from 26th December 2011 to 31st December 2011.

The sales figures for December 2011 are given below:

Category : Sub-Segment	Models	December			Till December			April '10 - March '11
		2011	2010	% Chng	2011-12	2010-11	% Change
Passenger Vehicles
Mini	M800, Alto, A-Star, WagonR	38593	45733	-15.6%	337423	407620	-17.2%	573238
Compact	Swift, Estilo, Ritz	20653	20557	0.5 %	154186	196885	-21.7%	261799
Super Compact	Dzire	9189	8601	6.8%	69976	78416	-10.8 %	107955
Mid-Size	SX4	843	761	10.8%	12505	14002	-10.7%	23317
Executive	Kizashi*	51	---	---	387	---	---	138
Total A: Passenger Vehicles		69329	75652	-8.4%	574477	696923	-17.6%	966447
B: Utility Vehicles	Gypsy, Grand Vitara	238	270	-11.9%	4534	4698	-3.5%	5666
C: Vans	Omni, Eeco	7908	13547	-41.6%	105881	118729	-10.8%	160626
Total Domestic Sales		77475	89469	-13.4%	684892	820350	-16.5%	1132739
Total Export Sales		14686	9756	50.5%	88469	107315	-17.6%	138266
Total Sales (Domestic + Export)		92161	99225	-7.1%	773361	927665	-16.6%	1271005

* Kizashi was launched in February 2011.

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