Maruti Suzuki Ltd reported a rise in its quarterly profits for the sixth-time but they were lower than expected by analysts due to increased commodity prices that have hampered its margins.
For the April-June 2018 quarter, the country's largest automaker reported a 27 percent increase in net profit to Rs 1,975 crore from the same period in 2017. On a year-on-year basis, the company's revenue was up by 28 percent to Rs 22,459 crore. The YoY increase in Maruti Suzuki's sales volume of 24.3 percent to 4.9 lakh units.
The company's earnings before interest, tax, depreciation, and amortization (EBITDA) was up by 44 percent to Rs 3,352 crore from last year, while its operating margin expanded to 14.9 percent from 13.3 percent.
In its stock exchange filing, Maruti Suzuki said that due to the higher commodity prices, its profit margin for the quarter has been lower than expected despite cost cuts and lower advertisement expenses. It further said that adverse foreign exchange and rising commodity prices could impact its profitability in the future as well.
Following the release of the Q1 results, shares of Maruti Suzuki declined as much as 4 percent, the most since February, to Rs 9,455 apiece after the results.