Tokyo: Japan’s Suzuki Motor Corp said on Monday it escaped a loss in the final quarter thanks to growth in its main Indian market, but forecast an 87% drop in profit this year as slumping global demand and a strong yen take their toll.
Suzuki, a maker of compact cars such as the Swift hatchback, has been relatively shielded by its big exposure to India where it controls about half of the car market through local unit Maruti Suzuki India Ltd.
With its best-selling Alto and new models such as the A-Star and Swift DZire, Maruti’s sales rose for the fourth straight month in April in contrast to trends in the United States and Japan, which have pummelled other Japanese carmakers such as Toyota Motor Corp and Honda Motor Co.
Even in Japan, Suzuki is benefiting from a shift in consumer preference towards the 660cc minivehicle segment, which it dominates with Toyota unit Daihatsu Motor Co. Suzuki and Daihatsu overtook Nissan Motor Co to rank second and third in Japan after Toyota in the last financial year.
Suzuki booked a fourth-quarter operating profit of ¥10.45 billion ($106 million), down 68% from the previous year but beating a consensus estimate of a ¥2 billion profit in a survey of 17 analysts by Thomson Reuters.
Net profit fell 54% to ¥5.8 billion, while revenue declined 27% to ¥670.2 billion.
For the year to 31 March, 2010, Suzuki expects an operating profit of ¥10 billion, far short of a consensus forecast of a ¥42 billion profit, and a net profit of ¥5 billion. Its typically conservative forecasts are based on an assumption that the dollar and euro will average ¥90 and ¥115, respectively.
Shares of Suzuki have jumped more than 60% in the year to date, far better than a 44 percent rise in Tokyo’s transport subindex .