Maruti vs Grasim Q2 FY26

Maruti Suzuki reported Q2 FY26 net sales of INR 40,130 crore (+12.8% YoY) and net profit of INR 3,290 crore (+7.5% YoY). Domestic volumes declined 5.1% due to pre-GST cut deferrals, but exports surged 42.2% to 110,487 units. Festive retail sales doubled to 400,000 units (vs 211,000 last year), with small cars growing 30% in October. Management guided for 6% industry growth in H2 and expects to exceed the export target of 400,000 units. The company reiterated its aspiration of 50% market share and 10% EBIT margin, supported by eight new SUV launches by 2030-31. Key risk: sustainability of the small car recovery given deferred sales and festive euphoria.

Guidance read

Industry growth of 6% in H2 FY26: Management expects overall industry growth of about 6% year-on-year in the second half and beyond. Exports to exceed 400,000 units in FY26: Given H1 exports of over 200,000 units, management expects to exceed the full-year export guidance of 400,000 units. Eight new SUV launches by 2030-31: Global President announced eight more SUVs to be launched in India by the turn of the decade, excluding Victoris and eVITARA. Aspiration of 10% EBIT margin and 50% market share: Management reiterated the goal of achieving 10% EBIT margin and 50% market share, as set by Suzuki Motor Corporation.

Risk read

Key risks include Sustainability of small car recovery — The strong festive retail sales may include deferred purchases and festive euphoria; sustainability is uncertain.; Margin pressure from discounting and mix — Higher sales promotion expenses (75 bps) and price corrections (20 bps) impacted margins; small car recovery could pressure blended margins.; Forex and commodity headwinds — Forex (JPY) and commodities (PGM) together adversely impacted margins by 30 bps; hedging gains are non-operating.; Market share recovery challenges — Global President noted that reaching 50% market share is more difficult than ever, despite product launches..

Promise ledger

Of 1 tracked promise, management 0 met, 0 close, 1 missed.

Grasim's Q2 FY26 standalone revenue hit a record INR 9,610 crore, up 26% YoY, driven by strong performance in paints and B2B e-commerce. The paints business (Birla Opus) achieved double-digit market share and top-of-mind brand recall as #2, despite a weak monsoon impacting QoQ sales. The B2B platform Birla Pivot grew 15% sequentially and is on track to reach its INR 8,500 crore FY27 target. Core businesses faced headwinds: cellulosic fiber EBITDA fell 29% YoY due to high input costs, and chemicals profitability remains range-bound. Management reaffirmed guidance for paints to become #2 and profitable within three years. Key risk: sustained pressure from global caustic price volatility and cheap Chinese imports.

Guidance read

Paints: #2 revenue market share and profitability within 3 years of full-scale operations: Management reaffirmed commitment to achieve number two revenue market share and profitability within three years of full-scale operations, with no change in strategy post CEO resignation. Paints: double-digit QoQ growth in Q3 FY26: Management guided for continued double-digit sequential growth in Q3, citing strong September and October sales momentum. Birla Pivot: likely to achieve INR 8,500 crore revenue target sooner than FY27: CEO indicated a likely chance of reaching the billion-dollar (INR 8,500 crore) milestone earlier than the stated FY27 target, though no formal revision yet. Chemicals: ECH and CPVC plants to contribute meaningfully from Q1 FY27: Mechanical completion expected by Q3 FY26, with meaningful contribution from first quarter of next financial year.

Risk read

Key risks include Global caustic soda price volatility — Chemicals profitability remains heavily dependent on caustic soda prices and chlorine demand, which are difficult to predict and subject to global trade dynamics.; Cheap Chinese imports impacting cellulosic yarn realizations — Cellulosic fashion yarn realizations continue to be impacted by cheaper imports from China, pressuring margins.; Paints market share deceleration risk — Analyst noted sequential market share gains have moderated from 100-150bps to ~20bps QoQ; management disputed this but acknowledged the need to accelerate volume share to match capacity share.; CEO resignation impact on paints business execution — The sudden resignation of Birla Opus CEO Rakshit Hargave raises questions about leadership continuity; management downplayed impact but successor not yet announced..

Promise ledger

Of 2 tracked promises, management 2 met, 0 close, 0 missed.