India's largest car maker Maruti Suzuki's profit declined for the first time in more than four years because of higher commodity costs and a weaker rupee.
The local subsidiary of Japan's Suzuki Motor Corporation reported a profit of Rs 2,240.4 crore in the July-September quarter, a decline of 10 per cent from the year-ago period. The company's revenue rose 3 per cent to Rs 22,433 crore.
“Rising crude oil and fuel prices impacted sales, volumes were also weighed by the higher upfront insurance payment of nearly Rs 9,000 on an average. We will continue our effort to make volume growth of 10 per cent on a yearly basis” said Maruti Suzuki Chairman RC Bhargava.
“The operating profit was impacted due to the increase in commodity prices, adverse foreign exchange movement and higher sales promotion expenses partially offset by cost reduction efforts,” the company said.
Shares of Maruthi Suzuki fluctuated between gains and losses to trade 0.3 per cent lower after the results were announced compared with a 0.9 per cent fall in the NSE Nifty Auto Index.
Shares of Maruti Suzuki on Thursday closed 43.85 points, or 0.70per cent, lower at Rs 6,724.70 on the BSE, while the benchmark Sensex closed 1.01per cent or 343.87 points down at 33,690.09 points.