Maruti Suzuki India Limited (MSIL) has revealed an ambitious investment plan, with the aim to significantly expand its production capacity and product range by 2030-31. The aggressive strategy, announced on Monday, involves a capital expenditure of over ₹50,000 crore, with a substantial portion directed towards manufacturing capabilities.
The company plans to double its annual vehicle production to 4 million units and expand its domestic sales volume. This expansion will be funded through the issuance of shares to Suzuki Motor Corporation (SMC), MSIL's parent company. The funds raised will also be allocated towards the development of new models with different fuel options and significant investment in electric vehicles (EVs) and SUVs production.
In addition to the expansion, MSIL aims to acquire a 100% stake in Suzuki Motor Gujarat (SMG), a facility with an installed capacity of producing 7.5 lakh units annually. This acquisition plan faced opposition from institutional investors due to potential financial implications such as reduced profits and cash shortage. Despite these concerns, the MSIL board approved the plan.
The investment strategy is expected to bring about positive changes in local economies and generate significant employment opportunities. As part of this plan, MSIL will also invest in expanding its sales, service, and spare parts infrastructure.
On Monday, amidst these developments, Maruti Suzuki's shares were trading at ₹10,250.35 on the BSE.
This aggressive investment strategy comes as part of Maruti Suzuki's broader effort to reinforce its standing in India's automotive industry. With a commitment of ₹45,000 crore (INR100 crore = approx. USD12 million) towards doubling the company's production capacity, MSIL is set to boost its manufacturing capabilities significantly over the next decade.
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