Hyundai Motor India Ltd (HMIL) reported a 23.9 per cent decline net profit to ₹1,196.5 crore in the second quarter of 2026-27 (FY27), from ₹1,572.25 crore in the year-ago period, as rising raw material costs put pressure on margins despite higher sales. Employee expenses also increased with the commencement of operations at its Pune plant, the carmaker said in an earnings release.
K S Hariharan, head of investor relations, HMIL, said the commodity outlook remained uncertain. While precious metal prices had moderated, that of others had remained high. “If you see copper prices, they continue to rise. So overall, if you see, the commodity situation [it] is highly volatile. We will continuously monitor the commodity trends and we will try to take whatever measures we have to take to protect our margins,” he said during a video press conference.
HMIL’s consolidated Q2FY27 revenue from operations stood at ₹20,696 crore, up 18.5 per cent from ₹17,156 crore in the year-ago period. Total expenses increased 24 per cent to ₹19,302 crore. The carmaker’s quarterly revenue crossed ₹20,000 crore for the first time, but higher sales did not translate into a higher net profit.
Hariharan said raw material inflation was a major reason for the decline in profit. “We had actually an impact of around 400 basis points (bps) due to raw material cost inflation on a year-on-year (Y-o-Y) basis and sequential impact was roughly around 250 bps,” he noted.
On the possibility of another price increase, HMIL Managing Director and Chief Executive Officer Tarun Garg said the company was taking a balanced approach. “The objective is to give maximum value to the customers. We have really tried to absorb as much as possible in terms of the price increases because we believe that probably things will ease out,” he added.
Garg said the company had expected the geopolitical situation to improve and prices to come down, but that had not happened. “I think we are just watching it very closely. And sooner or later, if things remain the same, we will definitely have a price increase. So, we will see if there is a need to take a price increase,” he noted.
HMIL said it had maintained pricing discipline despite a competitive market and the absence of new models during the quarter. Hariharan said domestic discounts had declined to 2.9 per cent in the September quarter from 3.2 per cent in the year-ago period. Meanwhile, the company’s average selling price rose by 2 per cent Y-o-Y.
Garg said HMIL had not seen any demand slowdown in rural markets over the past six weeks, despite concerns over the potential El Niño impact on rural incomes. Rural markets accounted for a record 26.6 per cent of its domestic sales in the September quarter. “As of now, we believe rural will still outpace urban growth going forward,” he said.
The pressure was visible in HMIL’s operating performance. Earnings before interest, tax, depreciation and amortisation (ebitda), a measure of operating profitability, fell 18.7 per cent Y-o-Y to ₹1,975 crore. Ebitda margin, a measure of operating earnings as a share of revenue, was down to 9.5 per cent from 13.9 per cent a year ago, but inched up sequentially from 9.3 per cent in the June quarter.
Garg said the company remained focused on achieving its full-year ebitda margin guidance of 11-14 per cent, with an improved margin trajectory expected in the second half. However, he did not give a specific timeline for recovery, as costs remain uncertain. HMIL said cost control, pricing discipline and a better business outlook would be important in improving margins in the coming quarters.
