Maruti Suzuki to raise prices after raw material costs surge
Maruti Suzuki is gearing up to raise car prices over the next six months, mainly because making cars has gotten a lot pricier.
Its profits took a hit last quarter, dropping 27%, thanks to a big jump in raw material costs, which also meant they missed what analysts were expecting.
Maruti revenue +26% margins squeezed
Even though Maruti's revenue grew by 26%, its expenses shot up even more, squeezing profit margins down to 5.5% from last year's 8.4%.
Higher commodity prices, inflation, and possible weakness in rural demand, partly due to El Nino in some states, are making things tough.
On top of that, Maruti's share price has slumped by 31.4% this year as new-car prices go up and inflation accelerated to an almost two-year high last month, making it harder for people to buy new cars right now.