Naveen Kulkarni and Ashwin Patil analyse Maruti Suzuki’s Q2 results
“Margin profile is probably slightly below expectation but Q3 and Q4 will be the more important quarters in terms of the overall margin profile because it is difficult to calibrate in terms of what kind of inventory they would have had in raw mate...
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Agencies
“The volumes are up in this quarter and so the rest of FY23 should be a better time for Maruti Suzuki,” says Ashwin Patil, Senior Research Analyst, LKP Securities. “The full impact of the benefit of raw material will come in Q3 and Q4,” says Naveen Kulkarni, CIO, Axis Securities.
We are analysing Maruti Suzuki numbers. For us, the margins are a tad bit below the estimates. How are you reading into Maruti Suzuki’s quarter gone by numbers?
Naveen Kulkarni: For this quarter also, the numbers were slightly lower than what we were expecting when we started the quarter. Second, margin profile is probably slightly below expectation but Q3 and Q4 will be the more important quarters in terms of the overall margin profile because it is difficult to calibrate in terms of what kind of inventory they would have had in raw materials and things like that.
I think the full impact of the benefit of raw material will come in Q3 and Q4. Those are the important quarters to look out for. We will wait for management commentary in the earnings call to get a better sense in terms of how production is moving and how the margin profile will behave in the upcoming quarters.
The PAT is coming at around Rs 2,061 crore. The revenue came in at around Rs 2,930 crore. The EBITDA is Rs 2,768 crore and the margins have come in at around 9.3%.
Ashwin Patil: We were expecting 9.8% or close to 10% margin and it has come slightly below our expectations. But nevertheless, the impact of the raw material prices were not completely seen in this quarter and that is why there were quite a couple of launches like the Grand Vitara, the new Grand Vitara and also the new Brezza in the quarter.
That would have definitely led to higher marketing expenses which brought down the margins to these numbers which are slightly below expectations but the numbers were not that bad. Going forward, with the easing of the semiconductor chip shortage issue, the RM prices impact will be felt in this quarter which is the festive quarter. The volumes are up in this quarter and so the rest of FY23 should be a better time for Maruti Suzuki.
We are analysing Maruti Suzuki numbers. For us, the margins are a tad bit below the estimates. How are you reading into Maruti Suzuki’s quarter gone by numbers?
Naveen Kulkarni: For this quarter also, the numbers were slightly lower than what we were expecting when we started the quarter. Second, margin profile is probably slightly below expectation but Q3 and Q4 will be the more important quarters in terms of the overall margin profile because it is difficult to calibrate in terms of what kind of inventory they would have had in raw materials and things like that.
I think the full impact of the benefit of raw material will come in Q3 and Q4. Those are the important quarters to look out for. We will wait for management commentary in the earnings call to get a better sense in terms of how production is moving and how the margin profile will behave in the upcoming quarters.
The PAT is coming at around Rs 2,061 crore. The revenue came in at around Rs 2,930 crore. The EBITDA is Rs 2,768 crore and the margins have come in at around 9.3%.
Ashwin Patil: We were expecting 9.8% or close to 10% margin and it has come slightly below our expectations. But nevertheless, the impact of the raw material prices were not completely seen in this quarter and that is why there were quite a couple of launches like the Grand Vitara, the new Grand Vitara and also the new Brezza in the quarter.
That would have definitely led to higher marketing expenses which brought down the margins to these numbers which are slightly below expectations but the numbers were not that bad. Going forward, with the easing of the semiconductor chip shortage issue, the RM prices impact will be felt in this quarter which is the festive quarter. The volumes are up in this quarter and so the rest of FY23 should be a better time for Maruti Suzuki.
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