Hyundai Motor India's Profit Skids 24% in Q2 FY27 as Raw Material Costs Bite

Hyundai Motor India (HMIL) saw its consolidated net profit plummet by nearly 24% to ₹1,196 crore in the second quarter of Fiscal Year 2027, despite achieving record-breaking revenue and sales volumes. This sharp profit slump is primarily due to a relentless surge in raw material costs, which significantly squeezed the automaker's operating margins. The profit erosion wasn't entirely unexpected, with commodity inflation impacting profitability by around 400 basis points year-on-year, according to K.S. Hariharan, HMIL's Head of Investor Relations. While some precious metal prices eased, crucial industrial commodities like copper continued their upward trajectory, making the overall commodity outlook highly volatile. Adding to the expense burden was the full operational commencement of HMIL's Pune plant, leading to increased employee costs. This mirrors broader economic pressures in India, where wholesale inflation hit 11.39% in September 2026, driven by higher fuel, food, and manufactured product prices, a trend exacerbated by global geopolitical tensions affecting supply chains and crude oil prices. Looking ahead, HMIL's management, including MD & CEO Tarun Garg, remains optimistic, projecting accelerated momentum in the latter half of FY27. The company plans to counter cost pressures through ongoing savings initiatives, strategic price adjustments—having already hiked prices multiple times in 2026—and a 'golden product cycle' featuring new launches like the Bayon, alongside a dedicated mass-market electric vehicle expected in Q4 FY27. This aggressive product pipeline aims to capitalize on India's resilient automotive market, which, despite inflationary headwinds, continues to show strong demand, particularly for SUVs and electric vehicles.