Hyundai India's Q3 profit drops 19% due to poor sales
What's the story
Hyundai Motor India has reported a massive 19% year-on-year (YoY) decline in its consolidated net profit for the December quarter.
The company's net profit was at ₹1,161 crore, compared to ₹1,425 crore in the same period last year.
The decline is mainly due to weaker domestic sales and exports.
Hyundai's revenue from operations also witnessed a marginal decline of 1.3%. It dropped to ₹16,648 crore from ₹16,875 crore in the same quarter of the previous fiscal year.
Market response
Hyundai's shares dip following Q3 earnings announcement
After Hyundai's Q3 earnings were announced, the company's shares on NSE dropped by over 1% to close at ₹1,627.
Since its debut on the stock market in October 2023, Hyundai India's stock has declined by over 10%.
The shares had listed at ₹1,931 on the BSE and ₹1,934 on the NSE, a tad below their issue price of ₹1,960.
Compared to the last quarter (Q2FY25), Hyundai's Q3 net profit fell by 16% from ₹1,375 crore.
Margin decrease
Hyundai's EBITDA margin dips due to subdued demand, geopolitical factors
Hyundai's Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) margin for Q3FY25 was recorded at 11.27%, compared to 12.88% in Q3FY24.
The company has attributed the decline in margins to subdued demand and geopolitical factors that have affected its financial performance this quarter.
Growth areas
Hyundai reports robust growth in rural penetration, CNG sales
Despite financial woes, Hyundai witnessed strong growth in some segments.
The automaker sold a total of 1,86,408 units of passenger vehicles in the quarter, with SUVs contributing significantly.
Hyundai also recorded its highest-ever CNG penetration at 15%, up from 12% in Q3 of last year.
Confidence
Hyundai remains confident despite market challenges
Hyundai's Managing Director Unsoo Kim admitted that the overall market is challenging due to global factors.
However, he was confident about the company's strong business fundamentals and its ability to leverage strengths for future growth.
"Our business fundamentals remain strong, and we remain confident in our ability to leverage our strengths and actively explore potential opportunities to improve our volumes and profitability," Kim said.