MARUTI UDYOG: THE HEAT IS ON
Article Abstract:
Maruti Udyog Ltd made a net profit of Rs6.51 billion on sales of Rs84.70 billion in 1997-98. Its sales grew by 6.5 percent and its net profit by 28 percent. Its sales volume grew by 7.7 percent and the sales of its luxury cars fell by 27 percent. With the arrival of the Matiz, the Santro and now the Indica, the small car market has become more competitive. The demand is stagnant at 5.5 lakh units, which includes multi-utility vehicles. The demand is not likely to increase till 2000 AD. Maruti Udyog Ltd has a production capacity of 2.5 lakh cars and jeeps. It produced more than 3.5 lakh units in 1997-98. It plans to increase its production capacity to 5 lakh cars. As the demand is unlikely to grow, Maruti Udyog Ltd will face lower capacity utilisation. The diesel versions launched by Maruti Udyog Ltd are likely to cannibalise its petrol versions of the Zen. The recent price cuts are likely to reduce the net profit of Maruti Udyog Ltd. Moreover, Maruti Udyog Ltd has agreed to raise the price of the automobile components it is sourcing from its partner, Suzuki, by 4 percent from April 1998 and 2 more percent from October 1998. Consequently, the expenses of Maruti Udyog Ltd will increase by Rs325 million. Its exports fell to 26,000 cars in 1997-98 from 36,000 vehicles in 1996-97. Maruti Udyog Ltd needs to launch new models of cars - possible only after 2 years - to face the increasing competition. It plans to launch diesel variants of the Esteem and the Gypsy. (rk) (kvr)
Publication Name: Financial Express Investment Week
Subject: Business, international
ISSN: 0015-2005
Year: 1999
User Contributions:
Comment about this article or add new information about this topic:
HALLMARK OF HAMCO
Article Abstract:
Hamco Mining and Smelting co. Ltd and of the Hamco group, a manufacturer of tin metal ingots and concentrates, posted a gross profit of Rs312.2 million in 1997-98 with about 70 percent of its turnover coming from trading operations. Its long term investments of Rs194.3 million in group companies has given it a yield of just about Rs1.4 million, which amounts to a return of less than 0.75 percent. The company has loaned out about Rs188.3 million worth of raw material to third parties while its stock of finished goods includes Rs44.8 million brought forward from 1995-96. (khr) ecialised markets of fine and superfine shirtings, denim and exports. The company has set up a unit to produce denim at Mauritius to avoid quota restrictions. Its profit margins were affected in the first quarter of 1998-99 due to the increase in prices of raw cotton and the interest costs on debt mobilised for its newly commissioned gabardine capacity. (khr)
Publication Name: Financial Express Investment Week
Subject: Business, international
ISSN: 0015-2005
Year: 1998
User Contributions:
Comment about this article or add new information about this topic: