Maruti profit dips, record volumes

Maruti Suzuki just posted record sales but is wrestling with slipping profit and its lowest market share in 13 years. Profits fell 6.5% even as revenues soared, with raw material costs jumping nearly 51%. The big question isn’t just about one-off accounting quirks—cost inflation and new regulations are squeezing margins in a market where Maruti’s pricing power is already limited. Despite capacity expansions and a record dividend, the company faces real pressure to defend profits without alienating price-sensitive buyers.

But here’s the catch: as Maruti pours Rs 14,000 crore into new plants and pushes out more vehicles, its grip on the market is loosening, especially in SUVs and EVs where rivals Tata and Mahindra are surging ahead. New emissions rules favor electric cars, yet Maruti’s electric sales lag far behind. The company is betting big on small cars and sedans, but tougher policies and potential supply shocks—from Middle East conflicts to packaging shortages—could unravel even the best-laid plans. The next year will test whether Maruti’s multi-pronged approach can keep it on top, or if rising costs and a shifting market finally force a reset.

Based on reporting from Reuters, Mint, Business Standard, NDTV, The Indian Express, Telangana Today, Zee News, and CNBC TV18.

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