Monday, November 29, 1999

Suzuki stock sinks, but Maruti to shine

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Suzuki Motor Corp forecast on Monday a tiny rise in annual operating profit as a supply bottleneck in India eases, while stiffer competition and higher input costs could slow growth in its single-biggest market.The maker of the Swift, Alto and other tiny hatchbacks has outperformed the industry in the past few years thanks to consumers' shift to smaller, more fuel-efficient cars around the world.Analysts said Suzuki would also benefit from recently expanded capacity in India -- at 1 million units a year as of March -- before it adds another 250,000 units from April 2012 to cement its dominance in the fast-growing Indian market.For the year to March 31, 2011, Suzuki, Japan's fourth-biggest automaker, forecast an operating profit of 80 billion yen ($874 million), up from the 79.37 billion yen it made last year. It expects net profit to grow 3.8 percent to 30 billion yen.A survey of 18 brokerages on average expect operating profit of 88 billion yen for 2010/11.Last month, Indian unit Maruti Suzuki India Ltd missed forecasts for fourth-quarter net profit and warned of margin pressure and slower sales growth as global automakers pile into the competitive compact car market.Suzuki's shares have fallen 18 percent in the year to date, underperforming a 6 percent rise in Tokyo's transport equipment sub-index.

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