Maruti Suzuki FY26 record profit, FY27 capex ₹14,000 cr

Why Maruti Suzuki is in focus

Maruti Suzuki India (MSIL) reported a record annual consolidated net profit of ₹14,679.5 crore for FY26, even as its March-quarter profit fell on mark-to-market and lower non-operating income. The earnings commentary also put the spotlight on capacity constraints, with the company saying it is operating close to 100% utilisation at existing facilities. Against that backdrop, management outlined a record capital expenditure plan of ₹14,000 crore for FY27. The updates matter because they connect demand recovery after the September 2025 GST rate reduction with near-term supply limitations and a fresh manufacturing investment cycle.

FY26 net profit hits a record

In a regulatory filing, Maruti Suzuki said FY26 consolidated net profit rose 1.24% year-on-year (YoY) to ₹14,679.5 crore. The company had posted ₹14,500.2 crore in FY25. Management linked the strong year to improved demand conditions after GST reforms and the GST rate reduction implemented from September last year. Chairman R C Bhargava described FY26 as a record year “in almost every respect,” attributing a large part of the performance to the tax change. The company also pointed to best-ever sales volumes as a key support for profitability.

Best-ever annual sales, led by domestic demand and exports

Maruti Suzuki said FY26 annual sales crossed 24.22 lakh units, its highest-ever. Domestic sales rose to 19,74,939 units from 19,01,681 units in FY25, marking the company’s best domestic volume year. Exports also hit a record 4,47,774 units, up from 3,32,585 units a year earlier. The combination of domestic recovery and stronger exports helped the company post record overall volumes. Management’s comments suggested the GST rate cut of September 2025 played an important role in reviving demand. The company’s operating context, however, is shaped by capacity limitations that may affect how quickly it can convert demand into deliveries.

Q4 FY26: highest quarterly sales, but profit declines

For the fourth quarter, Maruti Suzuki reported its highest-ever total quarterly sales of 6,76,209 units, up 11.8% from the year-ago period. Domestic sales in the quarter stood at 5,38,994 units. Exports were at an all-time high of 1,37,215 units in Q4.

Despite the volume record, the company reported a 6.45% decline in consolidated net profit to ₹3,659 crore for the quarter ended March 31, 2026. The company attributed the decline mainly to mark-to-market impact and lower non-operating income, including a notional loss linked to changes in bond yields. It said such losses can be recovered later, indicating the impact was not necessarily tied to core operating demand in the quarter.

FY27 capex set at ₹14,000 crore as utilisation nears 100%

Maruti Suzuki said it has earmarked a record capital expenditure of ₹14,000 crore for FY27 to add capacity and respond to rising demand. Bhargava said the company has reached close to 100% capacity utilisation, leaving limited room to respond to fresh order inflows without adding production lines. In another update, the company said it produced 24 lakh vehicles in the last financial year, underlining how tightly current capacity is being used.

Management linked the higher capex to installation work at Kharkhoda in Haryana and the start of work at a new site in Gujarat. The earnings call commentary also referred to backlog and very low inventories, signalling supply constraints in the system. Low inventories at dealers and the company typically mean dispatches track production closely, so incremental capacity becomes an important lever.

Capacity expansion: new lines at Kharkhoda and Hansalpur

The company said it will add 5 lakh units of capacity in FY26-27 by adding a production line in Kharkhoda, Haryana, and Hansalpur, Gujarat. In a separate update attributed to parent Suzuki Motor Corporation, the second line at Kharkhoda is scheduled to begin operations in the first quarter of the next fiscal year, while the fourth line at Hansalpur is expected to commence in the second quarter. Management also indicated output will rise in phases rather than immediately reaching full capacity.

On the ramp-up effect during FY27, management expectations suggested these two lines may add roughly around 2.5 lakh cars to production capacity during the year as operations stabilise. Taken together, the disclosures indicate a headline addition to installed capacity, but a more gradual contribution to actual output in the first year.

Gujarat expansion: fifth manufacturing facility planned at Sanand

Maruti Suzuki identified land in March 2026 for its fifth manufacturing facility at Khoraj Industrial Estate in Sanand, Gujarat. Once fully operational, the facility is expected to have annual production capacity of 10 lakh units. The company has said it will invest ₹10,189 crore to set up 2.5 lakh production capacity in the first phase at this fifth plant. This positions Sanand as a longer-duration expansion alongside the nearer-term line additions at Kharkhoda and Hansalpur. The investment also signals that capacity expansion is being planned beyond a single year cycle.

West Asia risk and export exposure to the Middle East

On broader risks, Bhargava said he expects only a limited impact of the West Asia conflict on the domestic car market. The company also said its exposure to the Middle East is limited to 12.5% of exports. The commentary framed geopolitical risk as manageable in the context of overall demand and capacity planning. With exports at record levels in FY26, the export mix and destination exposure can influence volatility, but the company’s statement suggests it does not see a major near-term disruption.

Key numbers at a glance

Market impact and why the concall matters

The key market takeaway from the earnings call is the combination of revived demand after the September 2025 GST rate cut and near-full capacity utilisation. Record FY26 volumes and record quarterly dispatches highlight demand strength, but the company’s commentary on backlog and low inventories points to supply constraints. That creates a clear link between capacity investments and the company’s ability to sustain sales momentum.

The March-quarter profit decline adds a second layer: volumes were strong, but reported profit was affected by mark-to-market movements and lower non-operating income, including a notional loss due to bond yield changes. Investors typically track whether such impacts are recurring or accounting-driven, and the company’s explanation framed it as recoverable later. Meanwhile, FY27 capex and phased commissioning schedules become key operational markers to watch through the year.

Conclusion

Maruti Suzuki’s FY26 results combined record annual profit and best-ever sales volumes, with management crediting the September 2025 GST rate reduction for a significant part of the demand revival. The company’s FY27 capex plan of ₹14,000 crore and planned capacity additions at Kharkhoda, Hansalpur, and the longer-run Sanand project set the agenda for the next phase of growth. Near-term attention is likely to stay on how quickly new lines ramp up, given the company’s comments on running close to full utilisation and maintaining low inventories.