Indian car makers boost sales but see profit margins shrink under cost pressure

In the June quarter, Indian automakers recorded strong demand, with Maruti Suzuki achieving a 29.3% increase in sales to over 6.8 lakh units and a 36% rise in net sales, yet its profit fell 10.8% and operating EBITDA margin contracted to 8.6% from 12.6% a year earlier. Tata Motors' passenger vehicle business grew volumes by 46% and revenue by 64.8%, but the group's overall profit plunged roughly 80% because of supply bottlenecks at Jaguar Land Rover, higher commodity costs and adverse forex effects.

Hyundai Motor India saw domestic volumes rise 5.4% while exports dropped 19.6%, leading to a 35% profit decline and a drop in EBITDA margin to 9.3%. Experts note that surging copper and aluminium prices, higher logistics costs, and a shift to monthly commodity settlements have eroded margins, and that automakers are absorbing much of these increases to keep sales momentum. Additionally, substantial capital spending on new plants and multiple powertrain technologies, including electric and hybrid models, is further weighing on current profitability.