maruti suzuki india ltd share price Management discussions


Financial year 2022-23 began amidst an uncertain macroeconomic environment. The price pressure, which was building up since the pandemic, was aggravated by geopolitical conflict in Europe. Supply disruptions, as a fallout of the conflict, surged inflation across the world, including India. Sensing the serious risk of persistently higher inflation on economic growth, RBI and the Government of India took decisive actions, which controlled inflation from going way beyond the comfort level. Meanwhile, the release of pent-up demand in contact-intensive services, ease of mobility restriction, near-universal coverage of vaccination, and improved availability of consumer finance increased the private consumption demand. The Government of India witnessed strong growth in the inflow of tax revenues, which enabled it to run its CapEx at full throttle. These components unitedly kept the economy resilient to unprecedented external shocks during the year. While India sustained its position as the fastest-growing major economy in the world, the lingering inflationary pressure remains a concern for the Indian Economy.

GDP growth (y-o-y)

Supported by the pent-up demand, the Passenger Vehicle (PV) industry sales posted strong growth in FY 2022-23. Consequently, the PV industry registered its highest-ever annual sales volume of about 3.89 million vehicles. The sales in the previous year (FY 2021-22) were affected by acute electronic component shortages and COVID-related disruptions.

Indias Passenger Vehicle Industry Sales Volume (units)

The shift of consumer preference towards Sports Utility Vehicles (SUVs) was accentuated further during the year. The share of SUVs in the overall passenger vehicle sales in the industry increased to 43% from 40% during the previous year. With this, the SUV segment further consolidated its leadership position. Despite the expansion of Indias passenger vehicle market, the share of hatchbacks has been declining continuously from its peak sales witnessed in FY 2018-19. In particular, the non-premium hatchback segment witnessed the steepest decline. Twelve models were offered in the non-premium hatchback segment in FY 2018-19, which have now been reduced to just seven models. While the decline in demand for sedans and partly for premium hatchbacks can be attributed to the shift in consumer preference towards SUVs, the contraction in demand for non-premium hatchbacks is entirely due to affordability issues. In the past few years, vehicle prices, especially for entry-level hatchbacks, have increased substantially due to several reasons, including product regulations, changes in vehicle insurance norms, and increases in road taxes by various state governments.

Contribution of sales from Hatchbacks in Indias PV Market

Financial year 2022-23 was indeed a special one for the Company as it celebrated 40th anniversary. The occasion became more celebratory with the Company recording its highest-ever annual sales volume of 1,966,164 units and exports of 259,333 units. The Company also clocked its highest ever production volume in FY 2022-23.

Financial year 2022-23 was also an action-packed year for the Company. It worked on multiple fronts. Among other things, it introduced three new models, four product refreshers, one of the worlds best Strong Hybrid Electric technology, six-speed automatic transmission technology, and a host of new-age technology features. Additionally, the Company extended the CNG powertrain to six models, ensured that its entire portfolio complied with new regulations/norms, started construction of a new manufacturing facility, demonstrated an electric vehicle concept, enhanced its manufacturing flexibility to accommodate market fluctuations, maximised the production volume amidst shortage of electronic components, and expanded the digitalisation drive.

When compared with FY 2018-19, the Company has increased its market share and strengthened its overall leadership position other than in the SUV segment. The Company strengthened its product portfolio in the SUV segment with the launch of Brezza and Grand Vitara, thereby increasing its market share in this segment. Moving forward, with Jimny and Fronx, the SUV product portfolio of the Company will be further strengthened. With this, the Company aims to secure a leadership position in the SUV segment. There were some doubts in the market about the Companys ability to effectively sell the high price range products. By making Grand Vitara and Invicto successful, the Company proved its ability and established its brand in that segment. The Company believes in offering products and technologies that are relevant to the Indian market context. Through extensive market research, the Company gathered that in the high-priced vehicle segment, customers prefer feature-loaded vehicles. The Company offered a _urry of classy features in these new models, which added to their excellent acceptance.

In FY 2022-23, while the supply situation of electronic components improved over the previous year, the shortages continued for SUVs and bigger cars, which were in high demand. During the year, the Company could not produce about 170,000 units because of electronic component shortages thus falling short of market demand. The pending customer orders remained at about 380,000 units at the end of the financial year.

Driven by new model launches, product refreshers, introduction of the Strong Hybrid powertrain, and the expansion of the portfolio of CNG-powered models, the Companys new model activity saw a multi-fold increase during the year. On the product regulations, phase-2 of Corporate Average Fuel Economy (CAFE) norms were mandated from 1st April 2022. The Company undertook relevant modifications in products and powertrains to ensure compliance with BSVI (phase-2) norms and to make all the models compatible with E20 fuel (gasoline blended with 20% ethanol). Given the Companys wider portfolio, comprising 16 models and over 100 variants, carrying out regulatory compliances is resource intensive. The Company, with meticulous planning and in close collaboration with various stakeholders ensured timely compliance. Engineering efforts further intensi_ed due to a shortage of electronic components, calling for optimisation of semi-conductor usage in vehicles.

For better convenience of customers and other stakeholders, the Company continued with enhancing the digitalisation of its business processes. The initiatives taken in this regard are explained in subsequent sections.

On the health front, the Company continued with its programme of administering the free booster dose of COVID vaccination to employees and their family members.

To expand production capacity, the construction of a new manufacturing facility in Kharkhoda, Haryana has started. A plant with a capacity of 250,000 vehicles per annum is to be commissioned within the year 2025, eventually increasing its overall capacity to one million. The facility has the potential to become one of the worlds largest manufacturing facilities.

The Company demonstrated remarkable resilience by expanding its operating margin during FY 2022-23. The margin expansion was contributed by improved operating leverage, better control on operating expenses, cost reduction efforts and a favourable foreign exchange rate. The Company took calibrated price increases to offset the inflationary pressure experienced in various cost elements and increased cost of complying with new regulations. The sales promotion expenses remained under control as sales shifted towards new models, even though the slow-moving non-premium hatchback segment attracted increased sales promotion. Put together the factors described above, the operating profit of the Company in FY 2022-23 increased to 7.3% from 3.5% over the previous year.

In the domestic market, the Company sold 1,644,876 units in FY 2022-23, posting a growth of 20.5% over the previous year. This includes 1,606,870 units of Passenger Vehicles (PVs) and 38,006 units of Light Commercial Vehicles (LCVs).

In the domestic passenger vehicle market, the Company continues to be the most preferred brand in the country. During the year under review, seven of the top ten best-selling PVs were from Maruti Suzuki.

In the domestic passenger vehicle market, FY 2022-23 was an eventful year for the Company in several ways, which include: a) addressing the gaps in the product portfolio, especially in the SUV space,

b) introducing the Strong Hybrid electric powertrain technology

c) expanding portfolio of CNG-powered models, and

d) introducing advanced technology-based safety, convenience, and comfort features.

Many of the technologies introduced were offered as first-in-the-segment. The Company introduced three new models and four product refreshers in FY 2022-23. The new model launches were Brezza, Grand Vitara, and Alto K10. The Brezza and the flagship SUV Grand Vitara garnered overwhelming bookings right from their introduction. The most notable aspect is that customer bookings were significantly higher for the top two variants of Brezza. Additionally, even before the price of Grand Vitara was unveiled, customer bookings were higher than anticipated, resulting in a waiting period of about five months. With Grand Vitara, the Company started to offer a strong hybrid electric powertrain, which offers about 32% higher energy efficiency over the conventional Internal Combustion Engine, significantly lowering the vehicles carbon emissions.

In FY 2022-23, with Brezza and Grand Vitara, the Companys SUV sales volume grew, helping the Company regain market share in the SUV segment. The Company also unveiled two new SUVs, Jimny and Fronx, at the Auto Expo 2023. These two SUVs will retail in the domestic market in FY 2023-24. If the supply situation of the electronic components improves and remains favourable, the Company aims to achieve market leadership in the SUV segment in FY 2023-24.

SUV market share of MSIL (%)

The Company has also offered a slew of advanced technology-based safety, comfort, and convenience features, including, but not limited to, Head Up Display, 360-degree view camera, six airbags, the Electronic Stability Programme (ESP) with Hill Hold Assist, sunroof, ventilated seats, tire pressure monitoring systems, and the Suzuki Connect Telematics Solution, an infotainment system offering over 40 connected features with advanced voice assist.

During the year, the Company also launched refreshers of the Ertiga, XL6, S-Presso, and Eeco. With the faster expansion of CNG dispensing stations across the country, the Company is confident that sales of CNG vehicles will increase. Besides offering S-CNG powertrain technology in all the products sold under the Arena channel, the Company extended its CNG product line-up for the products sold under the NEXA channel as well. Of the 16 models in its portfolio, the Company is offering CNG options in 14 models. While the overall sales of the Company increased by 20.5% in FY 2022-23, the sales of CNG vehicles grew by 40%. Consequently, the share of sales from CNG vehicles in the overall sales grew to nearly 20% from 17.2% in the previous year.

Expansion of the portfolio of CNG powered models (in PV Segment)

Sales of CNG Fuel Vehicles (PV + LCV) (in units)

Also, during the year, customer preference for green vehicles increased significantly. The share of sales of green vehicles, including CNG vehicles, Mild Hybrids, and Strong Hybrids, increased to 37% from 27% in the previous year.

The first-time buyers declined during the year. As seen in the past, the contribution of first-time buyers is higher in the non-premium hatchback segment. Consequent to the decline in the share of the non-premium hatchback segment since FY 2018-19, the proportion of first-time buyers in the Indian passenger vehicle market is also declining.

Customer Profile - FY 2018-19

The demand for passenger vehicles remained strong in the markets in Central and Southern India and in some of the markets in Eastern India. With constant endeavour to be closer to customers for offering better convenience and experience, the Company added 283 sales outlets primarily in non-urban markets during FY 2022-23.

With over 2,000 outlets in non-urban markets across the country, the contribution of sales from these markets in overall sales increased by ~1% to ~44.3% in FY 2022-23.

Despite a strong network presence in urban markets, the Company added 50 NEXA sales outlets, further strengthening its competitive advantage. The NEXA channel of the Company completed seven successful years of delivering premium automotive experience to customers. Since its inception, over 1.9 million cars have been sold across 460 NEXA outlets.

During the year, in the Light Commercial Vehicles (LCVs) segment, the Company sold 38,006 units of Super Carry from its 379 commercial channel outlets in 270 cities. CNG powertrain contributes to nearly 75% of the Super Carry sales volume. During the year, the sales of Super Carry grew by 12.4%. Super Carry is the second-most selling model in its segment.

For enhanced customer experience in sales processes, the Company continued to enhance its digital footprint. By leveraging virtual reality (Metaverse), the Company offered a digital showroom experience to its customers across its ARENA and NEXA sales channels. The Grand Vitara launch on NEXAVerse had an overwhelming response. This has helped provide innovative ways for customers to engage with the brand and to experience the range of products offered.

Maruti Suzukis pavilion at the Auto Expo 2023 was also presented in the Metaverse as well. About 1.5 lakh people who could not physically visit the Auto Expo could easily do so from the comfort of their homes by simply logging through the web or by using a virtual reality headset available at MSIL showrooms.

The ‘Maruti Suzuki Smart Finance (MSSF), introduced recently to offer online, end-to-end car financing, is seeing increased acceptance. In FY 2022-23, nearly 33% of the customers financed their cars through the MSSF platform compared with 23% in FY 2021-22.

The Company has digitalised 24 out of 26 customer interaction points while buying a car. The remaining two interaction points are the test drive and delivery of the vehicle.

Working on the initiative of setting up sales and service outlets on the principle of ‘Company Owned Dealer Operated (CODO), during the year, the Company activated nine outlets across the country on the land acquired by the Company. Moving forward, the Company will be activating thirteen more outlets under the CODO principle.

The demand for pre-owned cars during FY 2022-23 continued to increase. In FY 2022-23, the Companys True Value channel sales registered a year-on-year growth of 36%. The Company firmly believes in the future growth potential of pre-owned cars in India and is expanding the sales outlets accordingly. During FY 2022-23, the Company added 33 independent True Value sales outlets.


The Company is focused and aligned with the Government of Indias vision of ‘Make in India for the World and is putting all out efforts to increase exports.

The Company achieved its highest-ever export sales of 259,333 units in FY 2022-23. The Company emerged as Indias top passenger vehicle exporter for the second consecutive year by a wide margin. In FY 2022-23, the Company also achieved a landmark of cumulative exports of 2.5 million vehicles. The Company started exporting way back in FY 1986-87 and since then, its products have earned the acceptance and appreciation of global customers for their high quality, superior technology, reliability, performance, and affordability. The support of parent company, Suzuki Motor Corporation (SMC) has been vital in this achievement. SMC not only provided the Company a strong technological support but also helped the Company leverage its vast global network to increase exports.

In FY 2022-23, Africa continued to be the top export destination for the Company. This was followed by Latin America, the Middle East, and ASEAN region. SMCs distribution network and its continuous efforts to keep enhancing the capacity and capability of the network, coupled with the expansion of product portfolio, helped the Company to cash in on opportunities as the demand environment turned favourable in some of the markets.

Additionally, the OE supply of vehicles to Toyota through SMC in the African market also helped grow the export volume. With support from SMC, the Company continues to expand its product offerings for export market. The Company commenced exports of its successful premium SUV, Grand Vitara, in January 2023. With this addition, the Company broadly now exports its full range of products starting from the Alto, a product in the entry segment, to its most premium SUV offering, Grand Vitara. Besides expanding the product offering, the Company is augmenting capacity at the existing ports and also making use of new ports to enable higher exports.


With an objective to continuously enhance the customer delight during vehicle ownership, the Company continued its efforts such as expanding service touchpoints to reach closer to the customers, providing quicker, affordable, and higher-quality service, and improving the efficiency of customer interaction processes through digitalisation.

During the year, the Company added 310 service touchpoints. A large part of the expansion happened in non-urban markets. With 4,564 service touchpoints across the country, over 22.3 million vehicles were attended in FY 2022-23, the highest ever in the Companys history.

In order to reach closer to the customers in urban markets, the Company increased the service touch points in residential and non-industrial areas through a new format called the ‘Green Workshop.

In an endeavour to reach closer to the customers, based on the concept of Service-on-Wheels which provides routine maintenance service of vehicles at customers doorstep, the Company introduced Bodyshop-on-Wheels for providing repair services during the year, With the intent to minimise the financial burden on customers in case of unforeseen engine failures caused by waterlogging (hydrostatic lock) and adulteration in fuel, the Company introduced the Customer Convenience Package (CCP). So far, no insurance product in the country provides coverage against this damage. This scheme was well appreciated by the customers, and many customers opted for it.

With solutions like multi-language voice BOT, digitalised job card opening, digital owners manual, among others, the Company is aggressively moving towards digitalisation in the vehicle service area to provide a superior customer experience.

The skill level of workshop personnel is a prerequisite for delivering high-quality service. For this, the Company is training the workshop personnel on the global standards of Suzuki Service Qualification System (SSQS). In addition, the Company continued its efforts in training workshop personnel on the latest technologies, behavioural and soft skills. The Company adopted an online practical training mode to educate the workshop personnel at a faster pace in a resource-efficient, effective, and convenient manner. By using 15 broadcasting centres, the Company could upskill over 129,000 workshop personnel in FY 2022-23.

Aftermarket Parts and Accessories

One of the factors towards enhancing customer satisfaction is to have a minimum downtime of vehicles. Higher downtime is primarily caused due to vehicle being stranded in workshop for want of aftermarket parts. The shorter the downtime, higher is the satisfaction. A large portfolio of existing and discontinued products with more than 87,000 aftermarket parts coupled with seasonality in demand trends pose a big challenge for the Company to make spare parts readily available as per market need across the country.

The Company has been working on multiple fronts to keep customers happy. Along with better demand forecasting, digitalisation initiatives, and expansion of independent retail outlets of aftermarket parts and regional part distribution centres, the Company is ensuring timely availability of aftermarket parts.

The effectiveness of these efforts can be judged by the fact that at any given time, the vehicles- off-the-road are just about 400. The Company has sold around 25 million vehicles in domestic markets so far.

During the year, the Company added over 400 new accessories under Maruti Suzuki Genuine Accessories (MSGA) to meet evolving customer needs in categories such as safety, convenience, entertainment, and lifestyle. The Company also offers its customers an option of financing for MSGA.

*These independent outlets are in addition to the aftermarket parts available at the service network of over 4,500 workshops across the country.

The Aftermarket Parts and Accessories business of the Company in FY 2022-23 registered a strong growth of nearly 25% over the previous year and achieved its highest-ever sales in a financial year.


With the business environment becoming far more dynamic and interconnected and far less predictable, it becomes imperative for an organisation to be agile. For the past many years, the Company pro-actively worked towards increasing the flexibility in its operation.

During the year, the shift in consumer preference towards bigger cars, coupled with volatility in supply of electronic components, the Companys agile manufacturing capability was tested to its core. The volatility in supply of electronic components was so large that maintaining a stable rate of manufacturing became a challenge. Together with dynamic production scheduling and meticulous resource planning, the Company could maximise production volumes. As a result, the Company achieved its highest-ever annual production volumes in FY 2022-23. Despite such volatilities, the Companys robust change management systems helped maintain high levels of quality and productivity.

The product refreshers and new models introduced during the year received an overwhelming market response. In its pursuit to quickly serve customer orders, the Company augmented capacities of models such as Ertiga and Brezza. However, the shortage of electronic component supplies did not enable the Company make use of the available capacity.

The Company is not only optimistic about the growth of Indias automobile market but also about its export potential. In order to leverage this opportunity, the Company has put in place a plan to increase its manufacturing capacity. Starting April 2024, the capacity at the Manesar facility will increase by 100,000 vehicles. With this addition, the capacity at the Manesar plant would go up to 900,000 vehicles per annum. Besides, the Company has also started construction of a new manufacturing facility at Kharkhoda in Haryana. The first plant with a production capacity of 250,000 vehicles per annum is expected to be commissioned within the year 2025. In the first phase, the investment would be over Rs. 110 billion. The site will have space for capacity expansion to include three more manufacturing plants, each with a capacity of 250,000 units.

Recently, the complexity of manufacturing a vehicle has increased significantly due to increased features and regulations. This calls for continuous strengthening of a quality management system to ensure high-quality manufacturing. The Company places utmost reliance on preventing the generation of defects. The manufacturing and engineering teams collaborate to check the design for manufacturability at the design stage not only to identify and eliminate possible quality defects but also to help identify possible issues related to workplace ergonomics. During the product development phase, the Company has adopted a technique that uses multiple rounds of verification to ensure that the manufactured product is in accordance with the design. During mass manufacturing, to achieve tighter tolerances and at the same time ensure defect-free products, the Company leverages new technological solutions such as the Internet of Things (IoT) technology and machine vision systems.

The inspection systems are increasingly being shifted to the source (point of manufacturing) to prevent the outflow of defects. This significantly reduces the time required for any corrective action, leading to resource optimisation.

Conservation of Natural Resources and Environment Protection

One of the enablers of the Companys value creation is maximising the overall resource efficiency, thus leading to responsible consumption of finite materials. The Company actively practices aspects related to the circular economy such as eliminating waste, deploying the 3Rs (Reduce, Reuse, and Recycle) principle, and increasing the reliance on renewable energy. The Companys commitment to preserve natural resources is reflected in every step, right from product design to manufacturing processes and distribution to the end-of-life management.

Design to Recycle

With an objective to ensure the vehicles are not thrown away as waste at their end-of-life, the vehicles are designed for maximum recyclability and recoverability. All the vehicles currently being manufactured by the Company are, at a minimum, 85% recyclable and 95% recoverable.

Increasing the reliance on Renewable Energy

The Company has a total of 26.3 MWp installed capacity of solar

power. With this, the Company could avoid over 19,000 MT of Co2

emissions in FY 2022-23. Solar power contributes to about 12% of captive power generation. The Company has plans in place to further increase the capacity of solar power by 21.8 MWp by 2024. By partnering with Haryanas state electricity distribution company, the Company sources green energy at its Gurugram

facility. This has resulted in the avoidance of ove 6,000 MT of Co2

emissions in FY 2022-23.

Promoting the Use of the 3Rs Principle

The 3Rs principle is a way of life for the Company. The Company recycles 100% of the metallic scraps, such as steel and aluminium, generated during the manufacturing of cars. The state-of-art sewage treatment plants help in the recycling of water.

Carport Type Solar Power Plant (top view)

The Company meets 65% of its water requirement for manufacturing cars through recycling. With an aim to promote the recycling of commodities, the Maruti Suzuki and Toyota Tsusho Groups Vehicle Scrapping and Recycling unit commenced operations in the year 2021. The facility offers a hassle-free solution for customers to scrap vehicles in a safe and environmentally friendly way and has the capacity to scrap 24,000 vehicles annually.

During the year, the Company enabled recycling of about 1,140 MT of packing polythene sheets by selling through authorised recyclers. Additionally, the Company has implemented an Extended Producer Responsibility programme of recycling the plastic packaging used in its aftermarket parts and accessories.

The Company promotes yield-improvement activities to optimise the usage of resources such as steel, aluminium, and other materials. To further improve the energy efficiency at some of its manufacturing facilities, the Company is actively collaborating with a start-up. The Company also takes comprehensive measures to continuously reduce the usage of packaging materials. In the new Brezza, the Company was able to reduce

Carport Type Solar Power Plant (bottom view)

the usage of packaging materials by 30% over the previous Brezza. For the export Knocked Down (KD) kits and components over 45% of the packaging material requirement is met through reused material.

Environment Protection

As for environment protection, the Company not only conforms to laws and regulations but also strives to stay ahead. Initiatives are being taken at Tier-1 suppliers facilities for education and implementation of best practices to limit the usage of hazardous substances. Besides, audits are conducted at suppliers facilities in this regard. Contractual agreements and green procurement guidelines are executed with suppliers for promoting green products. The Company has established control procedures to ensure the effective implementation of guidelines by suppliers. The Company adopted the globally acclaimed International Material Data Systems (IMDS) tool to control the use of Substance of Concern (SoC).

(The Companys Sustainability Report elaborates on the initiatives undertaken in this section.)


The Company believes that a safe culture is built through effective involvement of the top leadership and equal participation from the front-line workforce to continuously identify safety threats and take measures to neutralise them. The Company also promotes a culture of safety with its stakeholder partners.

In line with this, a three-tier safety committee under the direct supervision of the MD & CEO is making constant progress towards the improvement of safety systems. This committee structure cumulatively held 90 meetings during the year, focused not only on continuously strengthening occupational safety but also on improving non-occupational safety.

The front-line workforce provided a total of 171,866 suggestions during the year for improving occupational safety. Besides, 4,365 suggestions were shared by the operators during the year, out of which the improvement measures have been implemented for 92% of the feedback and plans are in place to address rest of them. With the intent to prevent accidents, the Company encourages its workforce to report near-miss incidents and implements appropriate measures to address them. During the year, 1,137 near-miss incidents were reported, and the Company has implemented suitable countermeasures on all the actionable near miss incidents.

The Company observes Safety Month, a month-long engagement activity that also includes the families of employees and is focused on sensitising, educating, and sharing best practices related to occupational and non-occupational safety. This year, the theme of Safety Month was ‘Our Aim—Zero Harm. The Company undertook various measures to reinforce the culture of making safety a ‘way of life. Over 10,000 employees were trained during the year on various facets of safety, such as fire safety, electrical safety, safety in office spaces, emergency preparedness, and first aid among others. The Company also conducted ‘Nukkad Natak (street play) to engage and create awareness on the importance of adherence to the safety guidelines. To ensure road safety discipline and imbibe safe driving practices, the Company took various initiatives to promote and create awareness among its workforce and other stakeholders.


In financial year 2022-23, quality management related to both the new model development and mass manufacturing witnessed significant challenges.

With regards to new model quality management, the scale of work in FY 2022-23, as measured through new components being developed during the year, increased by over four times compared with that in FY 2021-22 due to:

a) increase in new model launches and product refreshers.

b) regulatory compliances, such as BSVI (phase-2) and E20 fuel material compatibility.

Given that passenger vehicles are the Companys largest product portfolio, carrying out changes for meeting regulatory compliances, especially on running or existing models, substantially increases the scale of work.

As for mass manufacturing quality management, the volatility in supply of electronic components not only resulted in frequent changeovers in product mix but also affected levelised manufacturing for both the Company and its suppliers.

The Company has put in place a robust quality management system, which is centred on reoccurrence prevention, early detection, and prevention of the outflow of defects. By actively collaborating with suppliers and other stakeholders, and strictly adhering to robust quality management systems, the Company was able to manage the challenges described above.

The Company also continued the ongoing quality management programmes detailed below to ensure improved quality of products.

A) Reinforcement of the Zero-Defect Philosophy

The Company believes that for utmost customer satisfaction, every product should be free from any defect. The Company places utmost thrust on delivering quality excellence through embracing the philosophy of ‘Zero-Defect. During the year, a series of sensitisation workshops by the Company encouraged suppliers to enhance their knowledge and implement best practices to achieve zero-defect production lines.

The Company has put in place an organisation that exclusively supports supplier partners to continuously improve their quality levels. The Company also observes ‘Quality Month every year to enhance quality consciousness among suppliers. Through customer product feedback, periodic surveys, and social media listening, the Company continuously assesses customers needs and expectations on product quality and takes appropriate measures to address them.

B) Quality Management During New Model Development

The Company implemented concepts such as front-loading, the Peak Production Verification Trial (PPVT), and initial flow management to ensure defect-free production of new models.

Front-loading helps to arrest defects at the design and development stage while PPVT and initial flow management help prevent defects during mass production of a new model. The Company uses its state-of-the-art testing facility in Rohtak, Haryana, to rigorously evaluate the new models for quality performance.

C) Quality Management During Mass Manufacturing

To maintain high-level quality standards during mass manufacturing, it is important to ensure (a) the periodic upkeep of plants and machinery, (b) the capacity and capability of workforce, (c) adequate process controls, (d) the availability of fool-proo_ng of systems, and (e) robust inspection systems among others. The Company has put in place various measures to continuously improve these factors at the supplier partners.

Besides, the Company constantly reinforces a culture of identification of root cause. Quality feedback from the market is carefully investigated. Once the right root cause is identified, prompt corrective actions are taken to prevent reoccurrence. The Company is also implementing a part-traceability system to correctly identify the affected vehicles with a potential quality defect.

D) Recall Management

During the year, in the interest of its customers, the Company recalled some of its vehicles and took corrective measures in a swift manner to reduce inconvenience to customers. The number of recalled vehicles reduced by over 60% from FY 2021-22.

Human Resources

Company Philosophy

The Company always strives to promote a safe, healthy, and happy workplace. It creates and instils a culture of partnership among its employees. The empowerment of human resource to acquire knowledge and build capability, grow, and prosper in a healthy work environment is the guiding philosophy of the Companys HR policies. With people-centric policy interventions, a constant two-way communication led by the MD & CEO to promote participative decision-making and various welfare measures are undertaken from time to time. As a result, the Companys motivated human resources have been making strong contributions in responding to business challenges successfully.

Employee Health and Wellbeing

Since the pandemic, the Company has accelerated its efforts to improve the physical and mental well-being of its employees. During the year, the Company conducted a company-wide survey to ascertain the happiness quotient of all its employees and then organised counselling sessions. A wellness programme using yoga, and training sessions on emotional, spiritual, and psychological wellbeing were organized. A total of 22 wellness sessions covering 6,333 employees were organised during the year. To promote the importance of physical health among the employees, including their families, events such as marathons and stepathlons were organised on a quarterly basis. The

Company continued its programme of administering free booster doses of the COVID vaccination to employees and their family members. By collaborating with several hospitals, the Company provided free annual health check-ups for the employees and their spouses. By tying up with an external partner, the Company also provided free online health consultations with the best doctors across India for the employees and their families.

Capability Development

The pandemic has brought out the importance of digitalising business processes to ensure business continuity. In addition, the Company placed utmost importance to inculcate a mindset towards digitalisation for not only ensuring business continuity but also to promote a culture of innovation among the employees. To achieve this, focussed training programmes covering over 15,000 person-hours of training were organised for employees across multiple levels. By partnering with BITS Pilani, a renowned academic institute, a new two-year post graduate programme on Digital Business was started during the year.

The Company introduced a new-age Learning Management System (LMS) during the year. The LMS uses artificial intelligence and machine learning to recommend relevant upskilling programmes based on the roles and responsibilities of an employee. Then, the employee can undertake self-paced training programmes through the exhaustive e-learning courses available internally or through external Learning Experience Platforms free of cost.

During the year, the routine trainings around capability improvement, career development, and transition assistance programmes were conducted.

Over a decade, the Company has been partnering with various academic institutions to provide access to undergraduate and postgraduate programmes to its employees. In FY 2022-23, based on the employees feedback, the Company introduced new courses, increased the number of institutes it partnered with, and increased the number of available seats, thus benefiting a larger number of employees. Eligible employees who complete the higher education programmes are considered for promotion to take up higher responsibilities.


Courses taken by

Number of employees benefitted so far under higher education programmes offered by the Company

Diploma programme Workers 601
B. Tech programme Supervisors 303
Part-time MBA programme Managers 170
Total 1,074

Apartments in Maruti Suzuki Housing Society

Industrial Relations Environment

The Company strives to ensure stable and cordial industrial relations through effective communication, participation of employees in important decisions, and various employee welfare programmes. Regular two-way communication, led by the MD & CEO, with the employees across various levels, keeps them informed on the overall business scenario, providing them with a strong platform for exchange of views.

Freedom of Association

The Company promotes freedom of association, and there are a total of three workers unions. The Company allows collective bargaining and actively collaborates with all the unions. During the year, elections were held in a smooth manner for electing the workforce union representatives at the Gurugram facility and powertrain facility at Manesar.


The Company offers industry-leading benefits with the average compensation being higher than the industry benchmark. The Companys compensation policies are gender neutral. To improve productivity and help achieve business goals, the Company also put in place a structured performance-based incentive pay structure that covers all categories of employees for all levels.

Employee Welfare

The Company values its employees, who have contributed to its progress. The Company contributes 1% of the previous years Profit After Tax to a fund exclusively earmarked for employee welfare. The fund is used to provide welfare measures, such as housing loan subsidies, educational support for employees children, developing common infrastructure facilities in employee housing projects, and to provide social security measures, such as post-retirement medical benefits for employees as well as their spouses.

At the housing project being undertaken in Dharuhera, Haryana, 262 houses have been delivered to the employees so far. A few more houses are under construction and will be delivered to the employees in due course.

Polling held for electing union representatives at Manesar Powertrain facility

Multi-layered Connect

For larger connect and welfare of employees families, the Company has a calendar of events, which includes expert career counselling for employees children, a gala family day, and plant visits for family members. In engaging with the families of the employees, communication through an in-house magazine and MD & CEO messages on special occasions play an important role.

Family day celebration

Gender Diversity and Inclusion

The Company promotes gender diversity and provides equal opportunity to all. Various welfare measures are taken to support and encourage female employees.

Grievance Redressal Mechanism

To address any grievances reported by its workforce, including among the temporary workforce, the Company has a well-structured grievance redressal mechanism. Periodic grievance redressal camps are organised to address their issues.

Awards and Recognition

As a result of all initiatives explained above, Maruti Suzuki was honored with the title "Best Place to Work 2022 in Automobile Industry" by Ambition Box.

Supporting Business Partners

The Company has put in place an exclusive organisation to improve the human resource and industrial relations practices at its business partners, such as its suppliers, dealers, and transporters. The interventions are centred around providing relevant skill training. Through multi-stakeholder initiative programmes, the Company focusses on creating a talent pool for its supplier and dealer partners. For more information on the initiatives and outcome of these programmes, kindly refer to page 58 of the Integrated Report.

During FY 2022-23, the Company provided over 998,008 person-hours of training for its employees and the workforce of its business partners.


In the passenger vehicle industry, the product is central to the growth and success of any organisation. With the strong support and guidance of Suzuki Motor Corporation (SMC), the Companys engineering function is working in the following key focus areas.

1. Introduction of New Products

In the last few years, the preference of Indian customers is shifting towards sport utility vehicles (SUVs). The SUV segment is now the largest segment of the industry, followed by the hatchback segment. Aligning with the changing customer preferences, the Company developed four new products in the SUV segment.

(a) Grand Vitara (b) Brezza (c) Jimny (d) Fronx

The Company launched models in other segments as well. The new Alto K10 and product refreshers of Ertiga, XL6, and Eeco were successfully launched during the year. All these newly launched products are fresh in design, high in performance, reliable, and are equipped with new technologies and features that are safe, affordable, and environmentally friendly to delight the Indian customer. Going forward, the Company is working to further expand its utility vehicle portfolio.

2. Introduction and Expansion of Advanced Features and Technologies

In line with customer preference, the Company is expanding features and technologies in its offerings.

During the year, the Company introduced a host of safety, infotainment, and connected, comfort, and convenience features in the Indian market. These features include sunroof, ventilated seats, the tire pressure monitoring system (TPMS), the all-new full digital instrument cluster, and wireless charger.

Other key technologies such as six airbags (driver, co-driver, side, and curtain), the electronic stability programme (ESP), the 7-inch and 9-inch infotainment system with HD display, the built-in next-gen telematics system (Suzuki-Connect), the Head Up Display, and the 360-degree view camera were extended to some of the new models and product refreshers models. The Company also expanded the offerings in Automatic Transmission and drivetrain technologies.

Automatic Transmission

Auto Gear Shift

4-speed Automatic Transmission

6-speed Automatic Transmission with paddle shifters

e-CVT Technology


Refers to the technology available in the products during the particular year

3. Reducing carbon footprint of fleet

The Company is committed to completely support Indias ambition of Carbon Net Zero by 2070 and intermediate targets before 2070. In automobile business, largest share of the Co2 emissions is contributed by products. While the Company is focusing on Co2 emission reduction in all its

business activities, reducing Co2 emission for the products

is one of the top priorities of the Company. As a result, the Company has the least carbon emission fleet among all car manufacturers in the country in FY2021-22 also (as per the latest annual fuel consumption compliance report, published by MoRTH). The Companys fleet weighted average carbon emissions has always been the least among

all car manufacturers in India. This Co2 data has also come

under government monitoring since FY 2016-17.

Reducing the overall carbon emissions cannot be achieved until the entire fleet of cars produced are included in the carbon reduction efforts. To make these efforts sustainable and good for the country, it is also important that the technologies deployed have maximum local manufacturing and are affordable to the consumers. Since the entire country has to reduce carbon footprint, the Company has to address carbon reduction on a life-cycle and well-to-wheel basis rather than limiting it to only a tank-to-wheel basis.

Global premiere of Concept Electric SUV "eVX"

The Company revealed the concept of its first electric vehicle (eVX) at Auto Expo 2023, and it will be introduced in the market in FY 2024-25. Our parent company, Suzuki, will invest in Gujarat, India, for constructing a plant for manufacturing of BEV batteries. This investment will support the Company in accelerating and expanding its BEV portfolio with localisation. To fortify the electric vehicle portfolio, the parent company Suzuki Motor Corporation has committed huge R&D investment in developing all six electric vehicle models that will be introduced by the Company till FY 2030-31. While the Company is focusing on BEVs, it might not be able to replace its entire fleet of cars immediately. Though the estimates vary, it would be a reasonable assumption that until 2030, at least 85% of the cars sold in India could be non-BEVs. Any meaningful carbon reduction cannot be achieved if this 85% of the volume is not addressed. The car industry needs more solutions that are scalable and faster for reducing carbon from the entire fleet. In addition to BEVs, the Company will deploy multiple technologies to address the entire fleet.

A) Reducing Carbon Footprint by Enhancing Fuel Efficiency of IC Engine Vehicles

The Company, with the support of SMC, has been able to progressively improve fuel efficiency of IC engine vehicles. The K-Series engine is currently offered in multiple con_gurations across the product line-up.

B) Promoting CNG Powertrain Technology

Besides being low-carbon emission vehicles that incur low running cost, CNG fuel vehicles also help in reducing the countrys import bill. This is a win-win situation for the customer, environment, and the government. With the governments increased focus on expanding CNG distribution infrastructure across the country, the demand for CNG vehicles is growing. During the year, CNG offerings were expanded to include products sold through the NEXA sales channel as well. Now, the Company offers CNG options in 14 models.

Contribution of CNG Vehicles in Total Domestic Sales (PV+LCV)

C) Deploying Mild and Strong Hybrid Electric Technologies

The Company has been offering mild hybrid electric technology in the XL-6, Ertiga, and Brezza. This year, the Company extended its mild hybrid electric technology to the Grand Vitara. The total share of mild electric hybrid vehicles in overall domestic sales stands at 16.4%. The introduction of Strong Hybrid electric vehicles with first model being Grand Vitara, will significantly help reduce the carbon emission of the conventional ICE vehicle without even the need of charging infrastructure. Strong hybrid electric vehicles are self-charging and have the potential to scale up quickly.

Grand Vitara - steep improvement in Fuel Efficiency (in kmpl) using Strong Hybrid Electric Technology

D) Exploring Biofuels like Bio-CNG, Ethanol, and Flex Fuels

Bio-CNG, Ethanol (E20 or 20% blending of ethanol in gasoline), and Flex Fuel Vehicles (FFV) seem to be other promising options in carbon emission reduction, especially when the country has a good amount of the agricultural biomass required to produce these green fuels, which would also be in the interest of Indian farmers. E20 is already a priority for the government as well. The Company is exploring all these technologies by undertaking a technical and commercial feasibility study to find the best solution for customers. During the year, the Company unveiled Indias first flex fuel, mass segment prototype car, the Wagon R FFV. This vehicle will be able to run on an ethanol blend ranging from 20% to 85%. This vehicle is planned to be launched in 2025. Ethanol fuels are biogenic in nature as they are largely manufactured using plant-based sources. Therefore, FFV technology can help reduce carbon emissions by approximately 79% in comparison to vehicles that run on gasoline fuel. In Indias context, Compressed bio-CNG (CBG) is another promising solution for carbon reduction that the Company is working upon.

The company has accelerated its efforts on carbon reduction technologies as seen in the table below.

New Generation K-series Engine

S-CNG Technology

Mild Hybrid Technology

Strong Hybrid Electric Vehicle Technology

ICE Compatibility with E20 fuel

Booster Jet Turbo Engine

Flex Fuel Vehicle

Electric Vehicle


(Prototype Developed)

(eVX prototype unveiled in


- Launch by 2025

Auto Expo 23).

Refers to the technology available in the products during the particular year

4. Rohtak R&D Center

The dynamic and evolving regulatory environment demands the capacity and capability to simultaneously meet the emerging needs of the market and regulatory requirements. The Company is working to meet ever-evolving regulatory requirements for its products, primarily around emissions and safety. The state-of-the art R&D test track and testing facilities at Rohtak enable the quick evaluation and development of products.

Supply Chain Management

The supply chain for car manufacturing is quite complex and spread geographically with significant interlinkages. In last few years, pandemic-led disruptions stressed these supply chains. While the disruptions due to pandemic have eased, there remains concern and uncertainty over shortages of electronic components due to semi-conductor shortages. Actions such as sourcing from alternate suppliers and alternate manufacturing locations, meticulous planning, continuous engagement with Tier-1 suppliers including their semi-conductor suppliers and optimising the usage of semi-conductors, have helped to maximise component availability. During the year, the Company registered its highest-ever production volume (including the production volume at Suzuki Motor Gujarat). However, the challenge of semi-conductor availability remains. The Company is taking appropriate mitigation measures to ensure continuity of production and to maximise the production volumes in FY 2023-24.

The Companys marquee product, the Grand Vitara, is being manufactured by an OEM in Southern India. In order to keep suppliers, especially of bulky components, closer to the OEM plant, the Company developed a supplier ecosystem in Southern India.

Cost Optimisation

During the year, the Company experienced cost pressure on account of inflation in various cost elements and also due to new regulations. To offset these cost pressures to certain extent, the company undertook several initiatives. These include localisation of direct and indirect imports, value engineering and analysis, yield improvement, energy efficiency improvement and tighter control on overheads. The Company continues to collaborate with the supplier partners in various cost down and efficiency improvement activities.

The Company was able to achieve significant amount of cost savings because of the suggestion scheme through which the employees contribute to idea generation and its implementation. During the year, the Company achieved highest ever cost savings of H4,987 million on account of such efforts.


Regarding outbound logistics, the Company is making constant

progress in increasing rail-mode dispatches, with Co2 emissions

reduction as one of its objectives. In the year 2022-23, the Company dispatched 335,245 vehicles through rail-mode, the highest ever in a year, with a growth of about 43% over 2021-22. In the last nine years, rail-mode dispatches have resulted in

the cumulative avoidance of over 6,700 MT of Co2 emissions.

The Company is implementing railway siding projects for the production facilities in Manesar and Gujarat. The railway siding project in Gujarat, once fully operational, will support dispatches of approximately 300,000 vehicles via rail-mode, avoiding

approximately 50,000 truck trips and about 1,650 MT of Co2

emissions every year. Besides vehicle dispatches, the Company is using primarily the rail-mode for transporting imported and export-destined components and materials between ports and plants.

The Company engaged with its driver partners by organising various training sessions focused on the driver safety, health, and well-being. During the year, more than 160,000 drivers and co-drivers participated in such trainings in online and of_ine sessions.

Financial Performance

The Company registered Net Sales of Rs. 1,125,008 million and Profit after Tax of Rs. 80,492 million, a growth of 113.7% over the previous year.

Abridged profit and loss account for 2022-23 (H million)



2021-22 Change
1 Volumes (Nos.)
Domestic 1,706,831 1,414,277


Total 1,966,164 1,652,653 19.0%
2 Vehicles


3 Spare parts/ dies & moulds/ components


4 Net sales (2+3)


5 Other operating revenue


6 Other income


7 Total revenue (4+5+6)


900,891 32.9%
8 Consumption of raw materials, components & traded goods


9 Employee benefit expenses


10 Finance Costs


11 Depreciation and amortization


12 Other expenses


13 Total expenses


855,068 28.1%
14 Profit before tax (7-13)


45,823 121.7%
15 Current tax


16 Deferred tax


17 Profit after tax (14-15-16)


37,663 113.7%

Table 2: Financial Performance – Ratios (As a Percentage of Net Sales)



2021-22 Change (%)
Material cost


78.6% (2.1)
Employee benefit expenses


4.8% (0.7)
Depreciation and amortization


3.3% (0.8)
Other expenses


15.1% (1.1)
Profit before tax


5.5% 3.5
Profit after tax


4.5% 2.7




FY22 Change Remarks where change more than 25%
(i) Debtors Turnover (No of Times)


51 -18%
(ii) Inventory Turnover (No of Times)


26 12%
(iii) Interest Coverage Ratio


389 -19%

(iv) Current Ratio




In FY 2021-22, the Company invested its cash surplus both in short-term and the long-term debt mutual funds. However, in FY 2022-23, the Company invested its cash surplus only towards long term debt mutual funds, this resulted in lower current assets.

(v) Debt Equity Ratio




Increase in short-term borrowing for meeting working capital requirement.

(vi) Operating Profit Margin (%)




Mainly due to higher sales volumes, and

(vii) Net Profit Margin (%)




favourable forex movement in FY 2022-23

(viii) Return on Net Worth


7.2% 96%

Treasury Operations

The Company has efficiently managed its surplus funds through prudent and cautious treasury operations. The guiding principle of the companys treasury investments is to keep safety and liquidity of investment over and above returns. In view of this, the Company invested its surplus funds in debt schemes of mutual funds and fixed deposits with banks. This has enabled the company to earn reasonable and stable returns.

Table 3 lists the investment of surplus funds while Table 4 lists the return on these surplus funds.

Table 3: Investment of surplus funds (H million)



Debt Mutual Fund


Fixed Deposits





Table 4: Income from investment of surplus fund

(H million)



Interest on fixed deposits


Income from investment in debt


mutual funds



Foreign exchange risk management

The Company is exposed to the risks associated with fluctuations in foreign exchange rates mainly on import of components, raw materials and export of vehicles. The Company has a well-structured exchange risk management policy. The Company manages its exchange risk by using appropriate hedge instruments judiciously depending on market conditions and the view on currency.

Internal controls and adequacy

The Company has a proper and adequate system of internal control to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition, and that all transactions are authorized, recorded and reported correctly. The internal control system is designed to ensure that financial and other records are reliable for preparing financial information and other data, and for maintaining accountability of assets. The internal control system is supplemented by an extensive program of internal audits, reviews by management, and documented policies, guidelines and procedures.

Risk Management

Ensuring Continuity in Component Supplies

During the year, the Company faced supply issues mainly because of shortages of electronic components. Through meticulous advance planning, maintaining constant communication with the top management of suppliers, developing alternate sources, and optimising the usage of semiconductors in electronic components, the Company is working to limit the impact of these shortages.

The Company is also working on an ongoing programme called the Vendor Comprehensive Excellence Programme to improve the capability of suppliers in various business functions, including risk management. A few areas covered under the comprehensive supplier assessment are fire safety, industrial relations management, quality improvement, financial prudence, water logging, succession planning, and minimising single-location supply dependence. The Companys strong focus on the localisation of components is also a part of its risk mitigation strategy.

Strengthening the Capacity and Capability for Future Product Development

Driven by a) new model launches, b) product refreshers, c) offering several advanced technology-based solutions to enhance safety, comfort, and convenience and d) carrying out several regulatory requirements on a wider product portfolio with multiple powertrain options, the demand increased not only for capacity of resources, such as human resource and testing facilities, but also for acquiring the appropriate capabilities to carry out the necessary development work. The Company is working towards enhancing the skills of its engineering human resources and is also implementing a multitude of measures to motivate and retain the talent.

Cyber Security

Over the past several years, the Company has made conscious and concerted efforts towards countering the threat of cyber security to its business. The Company has put in place a robust cybersecurity management framework. Measures such as educating the employees to reinforce and increase their awareness of phishing attacks and proactive monitoring through appropriate technology interventions are being undertaken to continuously enhance the security of the information assets and ensure business continuity.

For more information on Risk Management, refer to page 79 of the Integrated Report.


Automobile demand has a high correlation with economic growth. Various predictions about the economic growth of India in FY2023-24 hint at slowing momentum. Besides, we have to be mindful of the lag effect of repo rate hike on consumption in general and automobile demand in particular. As the rural economy is dependent on monsoon to a great extent, any negative deviation from normal rainfall may not augur well for automobile demand. The pent-up demand which drove industry growth in FY2022-23 seems to be tapering down. Overall, the passenger vehicle industry is expected to grow in FY 2023-24 albeit at a slower pace compared with that in FY2022-23. Any softening in interest rates, inflation and fuel prices, normal monsoon, normalisation of geopolitical situation etc. may improve the prospects of the passenger vehicle industry.

With the recent product launches and new-age technology offerings, the Company has strengthened its competitive position. This would increase the Companys ability to attract and cater to a larger customer base particularly in the SUV segment.

Accordingly, the Company is better placed to achieve growth higher than the average industry growth, thus leading to an increase in market share. Semi-conductor availability, which still remains uncertain, will play a crucial role in achieving business goals.

The company is optimistic of long-term growth potential of Indian passenger vehicle industry. For its parent, Suzuki Motor Corporation (SMC), the Company is an important subsidiary. Therefore, SMC is making all efforts to strengthen the future competitiveness of the Company. Recently, SMC, unveiled growth strategy for the entire Suzuki group wherein it has committed huge investment towards decarbonization efforts that include fortifying Maruti Suzukis electric vehicle line-up while simultaneously working on other carbon reduction powertrain technologies such as hybrid-electric, flex-fuel technology, Compressed bio-gas (CBG) and CNG. It has also expressed ambition to regain 50% market share in Indian passenger vehicle industry along with initiatives to achieve this ambition.