Maruti Suzuki India (MSIL) on Tuesday said its minority shareholders will vote for its Gujarat plant between November 16 and December 15, and the results would be announced on December 17.
The upcoming factory, which will have the parent Suzuki invest and own the plant, is expected to commence operations from March 2017, a couple of months before the deadline (May 2017), RC Bhargava, Chairman, MSIL, told reporters here on the sidelines of the company’s second quarter results.
Initially, the Gujarat plant was proposed to be owned by MSIL, but the plan was changed later with Suzuki Motor Corporation (Japan) announcing in January last year that it would invest $488 million to build the plant.
However, this change was opposed by institutional investors, forcing the company to seek minority shareholders’ approval.
Private sector mutual funds and insurance companies, which own almost 7 per cent of the company, led the opposition.
The company said all the issues have been addressed and MSIL has also got approvals from the Gujarat government and market regulator Securities and Exchange Board of India. To reach out to its investors, the company has started road-shows across locations, Bhargava said, adding that it is also meeting some investors in foreign lands, such as in Hong Kong, Singapore and the UK.
“We had one round of meetings in Mumbai and Singapore with investors. In Hong Kong, the meetings will be held on November 2-3, and in the UK on November 5-6. As far as regulatory approvals are concerned, the company has received all necessary nods,” he added.
On Tuesday, the company reported a standalone net profit of ₹1,225 crore for the second quarter ended September, up 42 per cent, compared with ₹862 crore in the corresponding period last year.
Sales up 13% Higher volumes, material cost-reduction initiatives and favourable foreign exchange contributed significantly to the bottomline growth during the quarter, the company said.
Net sales rose 13 per cent to around ₹13,575 crore during the quarter, against ₹11,996 crore during the July-September quarter last year.
EPS stood at ₹40.57 against ₹28.55.
MSIL’s sales volume also grew by around 10 per cent to 3.53 lakh units during the quarter compared with 3.22 lakh units in the same quarter a year ago.
“We expect Maruti Suzuki to report robust volume growth, going forward. Strong product portfolio, new launches and recovery in small car demand is likely to aid volume growth for the company,” said Arun Agarwal at Kotak Securities.
Shares of MSIL closed at ₹4,494.60 on the BSE on Tuesday, up 2.44 per cent from the previous close.