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MUL first quarter net up 35 p.c.

NEW DELHI: Maruti Udyog Ltd (MUL) on Thursday reported a 35.2 per cent jump in its first quarter net profit, largely on account of robust sales and new launches. Incidentally, while approving the first quarter results, the board has approved a proposal to change its name to Maruti Suzuki India Ltd. However, the change of name is subject to shareholders’ and other regulatory approvals.

The company’s net profit for the quarter ended June 30, 2007, went up to Rs. 499.60 crore from Rs. 369.57 crore in the corresponding period last year. Total income (net of excise) stood at Rs. 4,154.07 crore against Rs. 3,268.77 crore, up 27 per cent.

According to a company statement, the proposed name change has been done with a view to taking the Maruti brand globally, piggyback on Suzuki image.

“This international dimension in the company’s name will help Maruti as it expands its role in the global markets,” the release said.

The company plans to launch a new model for export to Europe in the next couple of years, while building on its recent success in Afro-Asian markets. Simultaneously, it is developing capabilities to become Suzuki’s R&D hub for Asia outside Japan.

New launches such as sedan SX4 and diesel variant of its runaway success ‘Swift’ have helped the company maintain its growth and record strong performance even as the industry is grappling with the problem of lax sales following increase in interest rates. It had also undertaken various marketing strategies like rural sales and employees scheme to enhance sales.

During the quarter, the company sold a total of 1.69 lakh units against 1.44 lakh units in the same period last year, up 17.1 per cent. In the domestic market, it sold 1.60 lakh units and closed the year exporting 9,065 units.

MUL’s total expenditure during the quarter rose to Rs. 3,356.03 crore from Rs. 2,668.87 crore in the same period last year.

The company said raw material and components cost accounted for Rs. 3,104.12 crore.

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