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Maruti Suzuki Q2FY22 earnings preview: Street expects 3% revenue growth

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Maruti Suzuki Q2FY22 numbers are going to be weak, no two ways about that. The bigger issue for Maruti is that its market share is under threat. There are several new launches by competitors in the sports utility vehicles (SUVs) as well as electric vehicles (EVs) space.

The numbers are going to be weak for Maruti Suzuki, no two ways about that. The bigger issue for Maruti is that its market share is under threat. There are several new launches by competitors in the sports utility vehicles (SUVs) as well as electric vehicles (EVs) space.
JPMorgan, in fact, put out a report that the company is going through weak model cycles. So that seems to be the overarching theme.
Apart from that, the company said that festive demand was quite weak; Navratri sales were down by 40 percent and there is very little clarity on the semiconductor issue.
So overall, looking at the numbers, the revenue growth will be muted, 3 percent growth because the volumes were actually down, just that the price hike that the company undertook will make sure that their realizations and revenue see a marginal growth.
The real problem for Maruti is in the margins. The EBITDA is expected to fall by 43 percent this time around, margins are expected to halve year-on-year. At the same time last year, they were at 10.3 percent and this year, it is expected to be 5.6 percent, and profit after tax (PAT) is expected to be down about 44 percent.
So muted growth, muted volumes could hit Maruti's performance this time around.
Watch the accompanying video of CNBC-TV18’s Sonia Shenoy for more details.
 
 
 
 
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