Maruti in high gear

Maruti Suzuki India Ltd on Tuesday reported more than doubling of its net profit for the last quarter of 2022. 2,351 crore, helping propel its share price by over 3% on the exchanges. The profit figure was better than the expectations of the analysts. 1,881 crore as per Refinitiv IBES data. Revenue from operations grew nearly 25% 29,044 crores. With chip shortages down, the assembly line now looks less likely to be disrupted, which bodes well for future sales. Commodities coming down from their recent peak of prices have helped on the cost front, to go with the relief Maruti’s import bill would have got from the weakening of the yen in rupee terms. Most importantly, the automaker’s results indicate strong market demand. Some of this may be thanks to new launches. But if the results of other carmakers also shine, it will strengthen the hope that the end of the Covid recession has also passed. Small cars, once the mainstay of Maruti’s sales, are lagging behind sport-utility vehicles (SUVs), but India’s car market leader has kept pace with a steady SUV roll-out. However, its weak point is its electric vehicle (EV) thrust. Tata Motors has taken the lead, and Maruti should follow.