Maruti Suzuki plans Rs 77,500 crore capex over 5 years to boost demand post-GST

The country’s largest carmaker Maruti Suzuki has earmarked Rs 77,500 crore in capital expenditure over the next five years to cash in on the demand momentum triggered by the GST reset, which gave impetus not only to the automobile industry but to several sectors of the Indian economy which continues to do well despite the impact of the West Asia war, Maruti Suzuki India Chairman RC Bhargava said.

Addressing shareholders at the company's 45^th annual general meeting, Bhargava Monday said, the tax reform provided the necessary buffer to navigate this uncertain period.

"The Indian economy continues to do well, and collections of GST remain higher than ever before. This is all despite the Iran problems, the West Asia war, and such issues. I do believe that without GST reforms, we may not have done so well in the difficult months that have elapsed”, he said.

Maruti Suzuki India expects the Indian "car industry will grow to 6.1-6.3 million by 2031, and that the share of the small car market will grow significantly faster" than it did in the previous five years, driven by the cuts in GST rates in September last year.

Hisashi Takeuchi, managing director at Maruti Suzuki told shareholders that the company, in fact, is seeing broad-based demand across segments, be it small cars or SUVs.

"Regarding the capex side for FY26-27, we have planned a 40 per cent jump in capex expenditure in a single year, from around Rs 10,000 crore last year to Rs 14,000 crore this year. Cumulatively, during FY26-27 to FY30-31, we have planned a capex of Rs 77,500 crore," he said in response to a shareholder query.

The latest plan is higher than the Rs 70,000 crore investment announced last year by Toshihiro Suzuki, Representative Director and President of Suzuki Motor Corporation (SMC).

Takeuchi said the expanded investment programme would cover a wide range of areas, including manufacturing capacity, product development and technology. He said, "Capex is planned for capacity expansion, new model development, R&D activities, plant measures, marketing and sales infrastructure, carbon neutral measures, and logistics, and so on."

Separately, Takeuchi also addressed shareholders’ concerns over the compatibility of Maruti vehicles with E20 petrol, assuring them that the company's cars produced since 2008 can run on the fuel. "I would like to assure that all of our current ongoing products are E20 compatible products. Actually, we have improved our compatibility to ethanol from the production year 2008. So after 2008, all of our products are E20 compatible."