Weak yen boosts Maruti Suzuki

Maruti Suzuki India rose 2.55% to Rs 1,702.20 at 11:19 IST on BSE after the Japanese yen weakened beyond 100 per dollar for the first time in four years.

Meanwhile, the BSE Sensex was up 27.98 points, or 0.14%, to 19,967.02.

On BSE, 56,000 shares were traded in the counter as against an average daily volume of 85,755 shares in the past one quarter.

The stock hit a high of Rs 1,712.85 so far during the day, which is also a 52-week high for the counter. The stock hit a low of Rs 1,666 so far during the day. The stock had hit a 52-week low of Rs 1,052 on 4 June 2012.

 

The stock had outperformed the market over the past one month till 9 May 2013, rising 17.90% compared with the Sensex's 9.40% rise. The scrip had also outperformed the market in past one quarter, gaining 4.50% as against Sensex's 2.33% rise.

India's largest car maker by sales has an equity capital of Rs 144.46 crore. Face value per share is Rs 5.

A weak yen could boost earnings of Maruti Suzuki as it imports raw materials from its Japanese parent Suzuki Motor Corporation. It also pays annual royalty on sales to the Japanese parent.

Shares of Maruti Suzuki India also rose as Suzuki Motor Corporation on Thursday, 9 May 2013, reported a 49.2% rise in net profit to 80.4 billion yen in the year ended March 2013 over the year ended March 2012, helped by record vehicle sales. Net sales inched up 2.6% to 2.57 trillion yen during the period under review.

Suzuki expects net profit to grow by 12% in the year ending March 2014 as the yen weakens against local currencies in key markets India and Indonesia.

Suzuki Powertrain India (SPIL) was merged with the company during the year ended 31 March 2013 (FY 2013) and the effect of the merger was given in the books of accounts in Q4 March 2013.

Excluding the effects of the SPIL merger, Maruti Suzuki India's net profit surged 79.8% to Rs 1147.50 crore on 9.4% increase in net sales to Rs 12566.60 crore in Q4 March 2013 over Q4 March 2012.

Meanwhile, the board has approved the amalgamation of seven wholly-owned subsidiaries of Maruti Suzuki India, namely, Maruti Insurance Business Agency, Maruti Irisurance Agency Services, Maruti Insurance Distribution Services, Maruti Insurance Agency Logistics, Maruti Insurance Agency Solutions, Maruti Insurance Agency Network and Maruti Insurance Broker into the company.

Japanese parent Suzuki Motor Corporation holds 56.21% stake in Maruti Suzuki India (as per the shareholding pattern as on 31 March 2013).

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