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ICICI Securities Report
Maruti Suzuki India Ltd.’s Q4 FY22 operational performance was ahead of consensus estimates as Ebitda margin came in at 9.1% (consensus: 8.2%), up 237 basis points QoQ, led by better operating leverage, lower discounts and cost-reduction efforts.
Gross margin survived raw material pressures due to:
13% higher volume QoQ with higher production from Suzuki Motor Gujarat's plant resulting in lower per unit sourcing cost;
delayed cost inflation impact to H1 FY23; and
higher export mix.
Despite price hikes, average selling price was up only 1% QoQ (12% YoY) due to mix impact as domestic utility vehicle mix declined 400 basis points QoQ.
Post decline in passenger vehicle market share to sub-45% for a major part of FY22, Maruti Suzuki is trying to recoup it toward 50% levels with increasing production led by easing of chip supply.
Successful launches to bridge gaps in the utility vehicle segment along with further ramp-up in production could further enable market share gains.
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