INR45,000 crore cash reserves, 3.5 million sales by 2030: what’s behind Maruti’s mega expansion
Automobile

INR45,000 crore cash reserves, 3.5 million sales by 2030: what’s behind Maruti’s mega expansion

By Eduardo Saverin

Workers fit out Maruti Suzuki Swift cars on an assembly line at the new auto plant at Manesar in Haryana.

Synopsis

Maruti is looking to double installed capacity to 4 million units by 2030. Recently the carmaker announced that a new plant would be set up with a production capacity of an additional 1 million vehicles every year. While Maruti is cash rich, with investments coming mostly from internal accruals, what does this mean for the shareholders and return on investments?

It came as a bit of a surprise when Maruti Suzuki, in a filing to the National Stock Exchange on April 26, revealed that its board has given in-principal approval for creating an additional capacity of up to 1 million vehicles every year in a new plant. While the plant’s location and the phases of capacity installation are yet to be finalised, the fresh investments would be funded through internal accruals. What’s driving this expansion drive is

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Eduardo Saverin