MUMBAI: After strong sales in 2025-26, the country’s largest carmaker, Maruti Suzuki India Ltd (MSIL), has set aside a capital expenditure of Rs 14,000 crore for FY27 to increase production capacity and meet rising demand.
The company, operating at 100 per cent capacity utilisation, produced 24 lakh vehicles in the last financial year.
MSIL will add 5 lakh units of capacity in FY26-27 by adding a production line in Kharkhoda, Haryana, and Hansalpur, Gujarat.
"This record capex is because we are continuing to install units in Kharkhoda. We are starting work on a new site in Gujarat, and therefore, the capex has gone up because of these new investments in manufacturing capacity," said MSIL chairman RC Bhargava on Tuesday.
Bhargava said he expects only a limited impact of the West Asia conflict on the domestic car market and believes growth momentum triggered by the GST rate cut of September 2025 will continue.
“We are going to see in the next few years is (that) every year we will see growth happening in the car industry because of the fact that the demand has once again revived. The GST reforms, which the government brought about from September last year, have had a very big effect, not only on the automobile sector, but in many other sectors”, said Bhargava.
He also dismissed concerns over MSIL’s domestic market share falling below 40%. Bhargava said the focus should be on fully using installed manufacturing capacity and selling vehicles at a reasonable profit.
“What happens to market share is an offshoot of what is happening to the total market,” he said, adding that increasing market share would require faster capacity expansion, which MSIL is already undertaking at an unprecedented scale.
Maruti Suzuki on Tuesday reported a 6.45% decline in consolidated net profit to Rs 3,659 crore for the quarter ended March 31, 2026. The company said the fall was mainly due to mark-to-market impact and lower non-operating income, including a notional loss caused by a change in bond yields, which can be recovered later.
Revenue, however, rose 28% to Rs 52,462 crore.
MSIL currently operates four manufacturing facilities in Gurugram, Manesar and Kharkhoda in Haryana, and Hansalpur in Gujarat, with a combined annual capacity of 24 lakh units.
As part of its expansion plan, the company has identified land for its fifth manufacturing facility at Khoraj Industrial Estate in Sanand, Gujarat. Once fully operational, the plant will have an annual production capacity of 10 lakh units.
