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Business News/ Markets / Stock Markets/  Maruti Suzuki’s board approves increase in Suzuki Motors stake by 2%
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Maruti Suzuki’s board approves increase in Suzuki Motors stake by 2%

Maruti Suzuki, on Friday, announced that the board of directors has approved the allocation of 12,322,514 shares to Suzuki Motor Company Ltd through a preferential allotment at the rate of ₹10,420.85 per share.

Maruti Suzuki | Photographed by Ramesh Pathania 9th August 2012.Premium
Maruti Suzuki | Photographed by Ramesh Pathania 9th August 2012.

Maruti Suzuki, on Friday, announced that the board of directors has approved the allocation of 12,322,514 shares to Suzuki Motor Company Ltd through a preferential allotment at the rate of 10,420.85 per share. According to a regulatory filing, the ownership stake of Suzuki Motor Company in India's leading car manufacturer will increase from 56.48% to 58.19% following this allotment.

"The board approved the allotment of 1,23,22,514 no. of equity shares of the company having face value of 5 each at a price of 10,420.85 per equity share," the filing read.

The company has announced that it will be releasing a payment of 10,420.85 per equity share for the acquisition of 100% equity shares of Suzuki Motor Gujarat Private Limited, totaling 12,800 crore.

In October 2023, Maruti Suzuki achieved its all-time highest monthly sales, with a total of 199,217 units sold. Additionally, the company experienced a year-on-year increase of approximately 7% in total exports, rising from 20,448 units to 21,951 units for the same month.

Looking at the year-to-date figures, Maruti Suzuki's overall sales for April-October 2023 exhibited a notable growth of 8.36%, surpassing the numbers from the corresponding period in the previous year by selling an additional 96,456 vehicles.

Earlier this month, the company revealed its intention to enhance flexibility in its production processes to adapt to the evolving market scenario. Maruti Suzuki aims to bolster the manufacturing of high-selling utility vehicles while scaling back the release of entry-level cars.

"Diverging demand patterns between utility vehicles and the small car segment is continuing. The company is working on increasing the flexibility in operations to produce vehicles as per the evolving market demand," Maruti Suzuki India Executive Officer of Corporate Affairs Rahul Bharti said in an analyst call.

He observed that the car manufacturer identified one factor contributing to the recent decline in profit margins: the production of “slow-moving cars."

"And we did not have sufficient production capacity for the cars that had demand. If we had the flexibility of both, whether it is semiconductor supplies or in-house production, we would probably have less of such a problem," Bharti said.

Maruti Suzuki share price closed at 10,481 apiece, against opening price 10,520 per piece, on Friday, November 24.

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Published: 24 Nov 2023, 03:48 PM IST
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