Shares of Maruti Suzuki lost nearly 1 per cent on Thursday ahead of its second quarter results scheduled later for the day.
Analysts believe that higher raw material prices may dent the automakers bottom line.
The carmakers market share was little changed during the quarter with domestic sales staying broadly flat YoY. Weakness in the entry-level car category such as Alto, WagonR and Ciaz models was slightly offset by a relatively strong showing by the mid-level category, brokerages said.
Karvy Stock Broking expects the company to report 9.60 per cent year-on-year (YoY) growth in net profit on 2.50 per cent YoY rise in sales. The brokerage house projected a 100 basis point cut in Ebitda margin for July-September.
Overall volume de-growth of 1.5 per cent YoY is likely to keep revenue growth muted, it said.
Another brokerage firm IDBI Capital Markets projected 19 per cent YoY fall in net profit at Rs 2,011.40 crore. “We expect revenues to grow by 3 per cent YoY and EBITDA margin at 14.7 per cent,” IDBI Capital Markets said in a report.
Market participants should watch management commentary, demand outlook for festive season, updates on pricing/discounting pressures and outlook on raw material prices.
The company is expected to report EPS of Rs 281 and Rs 330 in FY19E and FY20E, respectively, according to Karvy Stock Broking.
The scrip has dropped 30 per cent this calendar while the benchmark BSE Sensex advanced 0.65 per cent to 34,034 during the same period.
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