Maruti sees Sept vehicle sales rising 32-33%

Top Indian car maker Maruti Suzuki expects September vehicle sales to rise an annual 32 to 33%, bolstered by robust domestic demand, its chairman said on Thursday.

RC Bhargava said the company, 54.2% owned by Japan's Suzuki Motor, expects to sell 1.2 million vehicles in the current fiscal year that ends next March from 1.02 million in the previous year.

India is one of the world's fastest growing market for cars as a rapidly expanding economy boosts incomes and consumer spending.

"Clearly, the market continues to hold firm. There is no softening," Bhargava said. "We are now looking fairly optimistically at the rest of the year."

Beginning October, Maruti will increase its annual car-making capacity to 1.3 million units from its current capacity of 1.2 million units, he said.

Maruti plans to invest USD 1.3 billion over the next three years on manufacturing plants to boost capacity, it had said earlier this month.

The company would build its fourth auto plant in India, boosting its output to 1.5 million units a year. The new factory would start operations in 2013, with annual output capacity of 250,000 cars.

Bhargava said September sales would be higher than in August, when they rose 24% from a year earlier to a record for any month.

Maruti's share of the Indian car market at the end of August was 51.8%, he said. This is down from 53.2% in the previous fiscal year and 55.1% in 2008/09.

"We are not focused fundamentally on retaining market share. It's not a worry because we know we have capacity constraints, we have a waiting list," Bhargava said. He also said Japan's Nissan Motor Corp would source less than 30,000 cars this fiscal year from Maruti, compared with 51,072 cars last fiscal year, primarily due to a decline in European demand.

Maruti currently has a contract with Nissan to make and export the Pixo hatchback to European markets.

Shares in Maruti, which has a market value of USD 9.2 billion, were trading up 1% by RS 1,445 at 2.29 pm (0859 GMT) in a subdued Mumbai market. The stock is, however, down 7.4% this year versus a 14% rise in the index.

Advance tax numbers indicate good show by finance, auto cos

Advance tax collections for the second quarter, July-September, 2010-11 indicated Wednesday that while sectors like banking, finance and auto have done well, cement and pharma were down as compared to last year's numbers.

As for individual corporate, Mukesh Ambani-led Reliance Industries and Larsen & Toubro paid Rs 1,306 crore and Rs 280 crore respectively, higher than Q2 FY10.

RIL had paid Rs 1,157 crore in the year-ago period, indicating that it is steaming ahead. L&T's had paid Rs 210 crore in Q2 FY 10.

Similarly, Kumar Mangalam Birla-owned Hindalco's tax outgo doubled to Rs 140 crore.

However, it was a mixed bag from the Tata Group as Tata Power Rs 60 crore and Tata Motors Rs 95-crore paid less to the exchequer vis-a-vis last year.

Country's financial capital Mumbai, which contributes a major chunk of direct tax collection, clocked over 13 percent growth, which a top Income Tax official said was below expectations.

"Our expectations were more...some companies in sectors like cement are not showing good numbers," chief commissioner of Income Tax Mumbai, PP Srivastava, told PTI here, after the advance tax collections for September quarter ended Wednesday.

The Mumbai region of Income Tax Department has been assigned a direct tax collection target of Rs 1,50,480-crore for the current financial year, which is 35 per cent of the all India collection target of Rs 4,30,000-crore.

Asked if the target (Mumbai circle) would be met, Srivastava said that "we are hopeful. However, we will have to take extra measures to achieve it."

IT-major Tata Consultancy Services paid Rs 260 crore in advance tax as compared to the previous year's Rs 220 crore, while the payment by Tata Chemicals remained unchanged at Rs 60 crore.

Driven by high growth, advance tax payments in the auto sector were good.

Bajaj Auto paid Rs 243 crore in Q2 FY11, as against last year period's Rs 170 crore, while Mahindra & Mahindra paid Rs 158 crore, up from Rs 112 crore, the source said.

Barring some names, the banking and financial sector witnessed high tax payouts, led by State Bank of India (Rs 1,924 crore), ICICI Bank (Rs 600 crore), HDFC Bank (Rs 600 crore), Central Bank of India (Rs 206 crore), Union Bank of India (Rs 308 crore) and Yes Bank (Rs 105 crore).

Home-loans lender HDFC shelled out Rs 400-crore this quarter, as against Rs 320 crore in the year ago period.

Life Insurance Corporation's payout increased by Rs 128 crore to Rs 1,067-crore, while in the case of General Insurance Corporation, it almost doubled to Rs 92-crore.

The sector which appears to have suffered the most in Q2 FY11 since last year is cement, as payouts by a majority of companies in this segment have fallen sharply.

From last fiscal's Q2 of Rs 150 crore, Ambuja Cement's advance tax payment fell to Rs 90 crore, while UltraTech's payout more than halved to Rs 60 crore.

Cement major Lafarge's advance tax payment declined from Rs 67 crore to Rs 40 crore. In the case of ACC, its advance tax payment plummeted to Rs 60 crore from last fiscal's Q2 of Rs 150 crore.

Consumer electronics major, Videocon, saw its advance tax outgo increase to Rs 35 crore, from last year's Rs 30 crore while state-owned fertiliser company RCF showed a decline to Rs 19 crore from Rs 33 crore in Q2 last fiscal.

Biscuit maker Parle saw its advance tax outgo increase by Rs 3 crore to Rs 12 crore this quarter and Johnson and Johnson paid Rs 22 crore, up from last year's Rs 18 crore.

Two pharma majors -- Lupin and Cipla -- have registered lower payouts at Rs 45 crore and Rs 65 crore respectively as compared to Rs 50 crore and Rs 75 crore, respectively, in the year-ago period.

In the media and entertainment space, Zee Entertainment's payout almost doubled to Rs 60 crore from Rs 32 crore in the year-ago period.