Maruti Suzuki posts 23% net drop
Company struggles to recover from deadly labour unrest
India's biggest carmaker Maruti Suzuki Saturday reported a 23 percent plunge in quarterly profit, missing market forecasts as the company struggles to recover from deadly labour unrest.
Maruti said net profit fell to 4.24 billion rupees ($76.6 milllion) in the three months to June from 5.49 billion rupees a year earlier, marking its fourth straight quarterly profit fall.
Analysts expected Maruti, 54.2 percent owned by Japan's Suzuki Motor, to post a net profit of 5.0 billion rupees.
"Adverse currency movements, notably the yen-rupee exchange rate, impacted profits negatively," Maruti said, adding demand for petrol cars suffered "sharp de-growth" as buyers opted for cars powered by cheaper diesel fuel.
The price of importing components and technology from Japan has shot up due a slide in the value of the Indian rupee against foreign currencies.
The disappointing results come as Maruti strives to recover from the worst-ever labour unrest in the company's history on July 18 that left a manager dead and nearly 100 other executives hurt at one of its main plants.
The figures released Saturday were for the period up to June and did not reflect the unrest that has forced Maruti to indefinitely shut down the Manesar plant.
Maruti, which is battling fierce competition from South Korea's Hyundai and other rivals, said on Friday it did not know when it could reopen the riot-hit plant that makes 550,000 vehicles a year -- 40 percent of output.
A protracted closure of the Manesar plant would be a major setback for Maruti, whose profits slid 29 percent last year on the back of labour disputes over pay and union recognition.