India's top car maker, Maruti Udyog Ltd., on Monday reported a 23.7 percent rise in its June sales, boosting its shares by as much as 6.1 percent to their highest since June 6.
Maruti, 54.2 percent-owned by Japan's Suzuki Motor Corp., sold 59,917 vehicles in June. It sold 56,000 units in the domestic market, up 25.5 percent from a year earlier.
The biggest gain came in the A3, or mid-size, segment where Maruti's newly launched SX4 premium sedan helped contribute to a 46.4 percent rise in monthly sales to 3,923 units.
In the A2 or compact segment, Maruti's Swift hatchback continued to do well, boosting monthly sales by 38.3 percent from a year earlier to 37,646 units.
Maruti said in June there were delays in the delivery of the SX4 and the Swift on account of the high demand. After a planned maintenance shutdown last month, Maruti said on Monday supplies of these models were likely to improve.
Maruti had offered customer discounts and dealer incentives till June 15 to offset the impact of higher interest rates, which have caused a slowdown in auto sales in the industry. Some vehicle makers have cut production as a result.
Maruti's Swift and SX4 are made at its new plant in Manesar, near New Delhi, which has an initial annual capacity of 100,000 units.
"The plant is running at full capacity already, and there are waiting lists for the SX4 and the Swift," said Viraaj Teckchandani, an analyst at ASK Securities, who has a "buy" rating on the stock.
These newer models have higher margins than Maruti's older models and don't face an immediate competitive threat, he said.
Maruti has nearly half of India's market of mostly small cars, but is trying to shift customers to its more premium models. It will launch a new variant of its Vitara sport utility vehicle shortly.
Shares in Maruti were up 4.9 percent at 779.60 rupees at 0643 GMT, valuing the company at 225 billion rupees. Its shares are trading at 13 times forward P/E.
Maruti, 54.2 percent-owned by Japan's Suzuki Motor Corp., sold 59,917 vehicles in June. It sold 56,000 units in the domestic market, up 25.5 percent from a year earlier.
The biggest gain came in the A3, or mid-size, segment where Maruti's newly launched SX4 premium sedan helped contribute to a 46.4 percent rise in monthly sales to 3,923 units.
In the A2 or compact segment, Maruti's Swift hatchback continued to do well, boosting monthly sales by 38.3 percent from a year earlier to 37,646 units.
Maruti said in June there were delays in the delivery of the SX4 and the Swift on account of the high demand. After a planned maintenance shutdown last month, Maruti said on Monday supplies of these models were likely to improve.
Maruti had offered customer discounts and dealer incentives till June 15 to offset the impact of higher interest rates, which have caused a slowdown in auto sales in the industry. Some vehicle makers have cut production as a result.
Maruti's Swift and SX4 are made at its new plant in Manesar, near New Delhi, which has an initial annual capacity of 100,000 units.
"The plant is running at full capacity already, and there are waiting lists for the SX4 and the Swift," said Viraaj Teckchandani, an analyst at ASK Securities, who has a "buy" rating on the stock.
These newer models have higher margins than Maruti's older models and don't face an immediate competitive threat, he said.
Maruti has nearly half of India's market of mostly small cars, but is trying to shift customers to its more premium models. It will launch a new variant of its Vitara sport utility vehicle shortly.
Shares in Maruti were up 4.9 percent at 779.60 rupees at 0643 GMT, valuing the company at 225 billion rupees. Its shares are trading at 13 times forward P/E.
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