Maruti Net Beats Estimates as Weaker Yen Cuts Import Costs

Maruti Suzuki India Ltd. (MSIL), the nation’s biggest carmaker by volume, reported first-quarter profit that beat analyst estimates after a weaker Japanese yen lowered import costs.

Net income at Suzuki Motor Corp. (7269)’s Indian unit rose 49 percent to 6.32 billion rupees ($107 million) in the three months ended June, the New Delhi-based company said in a statement today. That beat the 6.18 billion-rupee median of 45 analysts’ estimates compiled by Bloomberg.

The carmaker benefited from the yen’s decline against the rupee in the 12 months through June, which makes components imported from Japan cheaper. Maruti’s local deliveries dropped 6.8 percent in the quarter after India’s economy expanded 5 percent in year ended March, the slowest pace in a decade.

“The favorable currency movement provided a lot of cushion to our margin estimates and could have offset minor hiccups,” Kaushal Maroo and Siddhartha Bera, analysts at Emkay Global Financial Services Ltd. in Mumbai, wrote in a June 13 report. “Post three years of poor volumes, the rebound is going to be very strong.”

Shares of Maruti fell 0.1 percent to 1,414 rupees at the close in Mumbai. The stock has declined 5.1 percent this year, compared with a 2 percent advance in the S&P BSE Sensex.

Net sales fell 5.1 percent to 99.95 billion rupees, lagging behind the 101.5 billion-rupee median of 45 analysts’ estimates compiled by Bloomberg. The earnings include the results of unit Suzuki Powertrain India Ltd., which was absorbed in the year ended March 31.

The yen declined about 14 percent against the rupee in the 12 months through June 30, according to data compiled by Bloomberg.

To contact the reporter on this story: Siddharth Philip in Mumbai at

To contact the editor responsible for this story: Young-Sam Cho at

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