India's Maruti Q4 profit nearly doubles

INDIA'S biggest domestic carmaker Maruti Suzuki has seen its net quarterly profit nearly double, bucking the weakest overall market in a decade.

Maruti's strong performance in the final quarter of the last financial year - driven by cost-cuts, a lower Japanese yen and demand for new models - far outpaced market expectations and propelled the firm's shares to a 52-week peak.

Profit for the three months to March 31 surged to 12.40 billion rupees ($A222 million) from 6.4 billion rupees a year earlier on sales that leapt 14 per cent to 131 billion rupees, the Japanese-controlled company said.

"The increase in net profit during the quarter was on account of higher sales of new models such as Ertiga, Dzire and Swift, cost reduction and localisation efforts and the benefit of a favourable exchange rate," the company said.

The earnings vastly surprised market forecasters who thought Maruti would post a profit of about 7.2 billion rupees.

Maruti's Ertiga minivans, Dzire sedan and Swift hatchbacks have all been big hits with Indian car buyers as increasingly affluent drivers seek bigger vehicles, countering softening demand for small entry-level cars.

The results, which included the impact of Maruti's merger with its engine production operation Suzuki Powertrain India during the last financial year, pushed the company's stock up by more than five per cent to 1,690.40 rupees.

Maruti, majority-owned by Japanese automaker Suzuki, has seen its costs drop sharply due to a near 10 per cent weakening of the Japanese yen against the rupee, which makes car parts imported from Japan much less costly.

Excluding the merger, Maruti's profit for the three months to March jumped 79.8 per cent to 11.5 billion rupees on sales that climbed 9.4 per cent in the same period to 125.7 billion rupees.

The strong performance by the company comes in the face of a decline for the first time in a decade of Indian passenger car unit sales.

Earlier this month, the Society of Indian Automobile Manufacturers reported domestic passenger car sales fell by 6.7 per cent in the year to March 2013 from a year earlier to 1.89 million units, hit by a sharply slowing economy.

Overall unit passenger car sales are expected to grow in the next 12 months but only by three-to-five per cent - a far cry from a record 30-per cent rise in 2010-11, the industry group said.

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