(Reuters) -Hyundai Motor India posted a better-than-expected quarterly profit on Wednesday on the back of strong exports and downplayed concerns over China’s rare-earth magnet export ban, saying its current stockpile is sufficient to handle any near-term disruptions.
Carmakers in India – the world’s third-largest auto market – are boosting exports to offset slowing local sales, tighter margins and rising discounts, even as China’s rare-earth export ban looms over EV supply chains.
However, Hyundai’s manufacturing head Gopalakrishnan C S said in a post-earnings conference call said the company remains unaffected by the ban for now, with adequate inventory.
“(With) rare earth as such, we are not facing any issue. We (have) adequate inventory for the near term already,” he said.
While profit declined 8% to 13.69 billion rupees ($156.7 million) in the three months to June 30, it topped analysts’ estimate of 12.59 billion rupees, according to data compiled by LSEG.
A 13% rise in exports helped cushion a 6% drop in quarterly sales, and the automaker expects overseas shipments to grow 7%–8% this fiscal year.
Managing Director Unsoo Kim said he expects the momentum to continue, with exports making up 27% of first-quarter sales and a 30% share targeted for the full year.
In the quarter, domestic sales fell 12%.
Its June-quarter revenue fell 5.4% to 164.13 billion rupees, while expenses dropped 5%. Shares, up 8% since listing in October 2024, closed 0.7% lower on Wednesday.
The Indian unit of South Korea’s Hyundai Motor, like several of its peers, is banking on the upcoming festive season and easing interest rates to revive flagging domestic demand.
Rival Mahindra and Mahindra reported a better-than-expected rise in quarterly profit, driven by robust demand for high-margin sports utility vehicles and tractors.
($1 = 87.3720 Indian rupees)
(Reporting by Chandini Monnappa and Nandan Mandayam in Bengaluru; Editing by Nivedita Bhattacharjee and Mrigank Dhaniwala)
