Hyundai Motor India Ltd (HMIL) on Tuesday reported a 21.5 per cent growth in net profit in 2018-19, bucking a slowdown hurting the domestic passenger car sales across the industry.
The company reported Rs 2,581.7 crore as net profit in 2018-19, compared to Rs 2,124.2 crore a year ago. Overall sales rose by around 3 per cent to 7.1 lakh units from 6.9 lakh last year. HMIL sales in the domestic market increased to 5.45 lakh units during 2018-19, from 5.36 lakh units. It was a 2 per cent growth, said the company in its annual return filed with the Ministry of Corporate Affairs.
Exports grew by 5.2 per cent to 1.62 lakh units during the year, compared to 1.54 lakh units in the previous year. West Asian and African countries contributed 53 per cent and 14 per cent to the company's exports, forming the largest chunk. Exports to Latin America and Asian regions decreased by 13 per cent and 24 per cent.
The company achieved its highest ever wholesale sales volume--of 52,001 units--in October 2018 since inception. It has achieved a milestone of 8.5 million cars production in January 2019. The total production was 7.1 lakh units as against 6.9 lakh units previous year with an increase of 2.6 per cent. Parallel production in the manufacturing line and an increase in unit per hour contributed to the production growth, said the company.
"Liquidity crunch followed by NBFC crisis led to moderation in credit availability thereby negatively impacting domestic demand and growth in H2 financial year 2018-19. Hence overall FY 2018-19 growth came at 5 year low of 6.85 per cent compared to 7.2 per cent in FY 2017-18. Stable Government ensuring policy continuity, fiscal stimulus , liquidity easing measures from RBI and improvement in India's rank in Ease of doing business index should facilitate economic recovery in coming years," said the company about the industry trends this year.
Retail credit squeeze due to NBFC liquidity crisis, uncertainty in taxi policy regarding diesel ban and safety norms regulation, election uncertainty, increase in insurance and fuel cost were the main factors that contributed the above fall in growth rate. However new launches through Auto Expo 2018 and reduction of interest rate at the end of the Financial Year contributed to a marginal growth in the industry.
The company is in the process of increasing the capacity to 7.5 lakh units per annum to meet the market demand by way of automating certain processes, removing the bottlenecks in the production process and introduction of new models, it said.
An email sent to the company asking for comments was not responded till Tuesday evening.