Shares of Maruti Suzuki rose 2.4% in early trade after the company announced price hikes across its models, and March sales showed a notable improvement in higher-margin verticals.

The stock was trading around Rs 8,495 on the BSE at 11:30 am, 2.4% above its previous close.

The company increased the prices of its vehicles from 1 April. In an exchange filing, the country’s largest carmakers said that the increase, calculated using ex-showroom prices of models in Delhi, across all models, would average 0.8%.

“The company continues to witness increased cost pressures driven by headline inflation and regulatory requirements. While the company is doing its best to reduce costs and partially offset price increases, some of the impacts will have to be passed through price increases,” it said.

The sentiment was also boosted after sales in March showed healthy growth in its higher-margin verticals (utility vehicles (UV) and exports), although overall sales were flat year-on-year.

In March, the company sold 37,054 UV units, an increase of more than 48% over the same period last year. In March 2022, 25,001 units were sold. Models in this vertical include the Brezza, Ertiga, S-Cross, XL6 and Grand Vitara.

The company is trying to expand its presence in this segment, which includes sports utility vehicles and multi-purpose vehicles (MUVs), with SUVs gaining popularity. SUVs now account for more than 42% of the domestic car market.

At the Auto Expo in January 2023, Maruti Suzuki’s managing director and CEO, Hisashi Takeuchi, said the company “underestimated” the growth rate of the SUV segment and now aims to become the leader in the segment by FY24.

Exports in high-margin verticals also rose year-on-year in March. Total exports were 30,119 vehicles, up nearly 14% from 26,496 in March last year.

The company’s overall domestic sales fell to 1,39,952 vehicles from 1,43,899 a year earlier. That brought the total (domestic plus exports) down to 1,70,071 from 1,70,395 a year earlier.

In FY23, the company posted its highest-ever total sales of 19,66,164 units, up 19% from FY22.