India’s largest carmaker, Maruti Suzuki, struck a cautious tone on the outlook for FY26, citing muted domestic demand and affordability constraints in the passenger vehicle market.
"The local market has been soft, and growth was extremely limited," the company said at a post-earnings press conference. It added that FY26 is unlikely to see a significant improvement, with industry body SIAM projecting a tepid 1–2 percent growth.
Maruti also questioned whether a potential income tax break would be enough to revive the struggling small car segment, noting that only 12 percent of Indian households are currently in a position to afford a car.
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On the export front, the company expects international shipments to account for 20 percent of its sales in FY26, up from 18 percent last year. It clarified that it doesn’t export to the US and is therefore insulated from global uncertainties in that market.
The subdued commentary came after Maruti Suzuki reported a weaker-than-expected set of numbers for the fourth quarter. Standalone net profit declined 4.3 percent year-on-year to Rs 3,711 crore, missing analyst expectations of Rs 3,852 crore. Revenue rose 6.4 percent to Rs 40,674 crore, but EBITDA fell 9 percent to Rs 4,264 crore, with margins shrinking 150 basis points to 10.5 percent.
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Experts said that this was largely due to higher marketing and advertising spending, higher discounts, partly offset by operating leverage, and increased sales of CNG vehicles. Furthermore, the margin would also be impacted by Kharkhoda plant’s higher depreciation and overhead costs.
While domestic sales rose just 2.7 percent in FY25, export growth of 17.5 percent helped lift total volumes by 4.6 percent for the year. The company announced a final dividend of Rs 135 per share for FY25.
Maruti Suzuki shares closed at Rs 11,652, lower by 2.1 percent from the last close on the NSE. Maruti's share price has risen 8 percent since the start of the year.
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