HYUNDAI

March 21 (Reuters) - Mahindra and Mahindra MAHM.NS will increase prices of its SUVs and other commercial vehicles by up to 3% from April, the company said on Friday, becoming the latest Indian carmaker to raise prices to combat rising costs.

Already, market leader Maruti Suzuki MRTI.NS, Tata Motors TAMO.NS and Hyundai Motor India HYUN.NS have said they will hike prices between 2% and 4% from next month.

These higher expenses are due to rising commodity prices, elevated import duties on raw materials and supply chain disruptions.

Mahindra and Mahindra said its price increases will vary depending on the model of the vehicle.

(Reporting by Ananta Agarwal in Bengaluru; Editing by Savio D'Souza)

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** Indian carmaker Hyundai Motor India HYUN.NS gains as much as 2.4% to 1,653 rupees in early trade, last up 1.4%

** HYUN to hike prices by up to 3% from April due to higher input and operational costs

** 18 brokerages' avg rating on stock is "buy", median PT is 2,029 rupees - data compiled by LSEG

** Stock down about 15% since trading debut on October 22

(Reporting by Manvi Pant in Bengaluru)

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** Shares of Hyundai Motor India HYUN.NS rise 2.5% to 1,618.9 rupees

** Rise after Axis Capital starts coverage of stock with "buy" rating and a target price of 1,950 rupees, implying an upside of 23% in 12 months

** Axis says it prefers HYUN over Maruti Suzuki MRTI.NS to drive domestic passenger vehicles growth

** Estimates revenue to see a 11% compound annual growth rate (CAGR) over fiscal years 2025-2028, helped by volume growth in the passenger vehicles segment, new launches

** Estimates core profit margin to increase to 12.9% in fiscal year 2028 from current 12.5%

** Extensive product portfolio, proven technology across electric vehicles and hybrids, strong brand recall to help HYUN gain market share - Axis

** Average rating of 17 analysts, excluding Axis Capital, is "buy"; median target price is 2,050 rupees - data compiled by LSEG

(Reporting by Bharath Rajeswaran in Bengaluru)

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March 13 (Reuters) - Ashok Leyland Ltd ASOK.NS:

• INDIA'S FEB 2-WHEELER SALES 13,84,605 UNITS - INDUSTRY BODY

• INDIA'S FEB 3-WHEELER SALES 57,788 UNITS - INDUSTRY BODY

• INDIA'S FEB TOTAL DOMESTIC PASSENGER VEHICLE SALES 3,77,689 UNITS - INDUSTRY BODY

• INDIA AUTO INDUSTRY BODY: UPCOMING FESTIVITIES OF HOLI, UGADI IN MARCH LIKELY TO CONTINUE TO DRIVE DEMAND

Further company coverage: ASOK.NS

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** Hyundai Motor India HYUN.NS slips as much as 4% to 1,661.1 rupees

** Carmaker's total monthly sales drops 2.9% y/y in February

** Co says geopolitical challenges led to drop in sales

** Believes tax reforms in union budget, improved liquidity will provide demand boost to domestic market

** Stock rated "buy" on avg; median PT is 2,029 rupees - LSEG

** HYUN last down 1.7%, extending YTD losses to 4.2%

(Reporting by Meenakshi Maidas in Bengaluru)

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By Arpan Chaturvedi, Aditya Kalra and Aditi Shah

NEW DELHI, Feb 26 (Reuters) - Indian tax authorities have singled out Volkswagen as the only automaker to wrongly classify its car imports for 12 years to evade $1.4 billion in taxes, even as rival Kia changed its practice after being pulled up, court papers show.

Volkswagen is a tiny player in India's car market, which is the third biggest in the world, and its Audi brand lags luxury peers such as Mercedes and BMW. If found guilty it could face dues of $2.8 billion, including penalty and delayed interest.

The court fight over the record tax demand is a matter of "life and death", Volkswagen's Indian unit says. The highest import tax demand in India's history has also rekindled investor worries that lengthy disputes could stymie their plans.

India says Volkswagen used a clandestine scheme to import auto parts in separate shipments, to evade detection and cut taxes, instead of declaring items as "completely knocked down", or CKD, units that face higher taxes of 30% to 35%.

Rebutting Volkswagen's court plea, tax authorities listed 10 carmakers, from Mercedes-Benz MBGn.DE to BMW BMWG.DE and Hyundai 005380.KS, HYUN.NS, that correctly classified their imports, despite using "split consignments" to bring in parts.

South Korea's Kia fell in line after being warned, the authorities said in their 506-page filing, which is not public, but was seen by Reuters.

"Earlier, they were clearing such imports as parts, against which investigation was undertaken," the authorities told the court about the altered practice at Kia, which continues to fight a demand for $155 million in tax.

"Post the investigation, they have started classifying such imports correctly."

This month Reuters reported Kia was contesting a $155-million tax demand from 2024 for the similar import, in separate shipments, of parts for its Carnival luxury minivan. Kia says it is reviewing the matter and cooperating with authorities.

A senior Indian tax official, speaking on condition of anonymity, confirmed Kia had "accepted misclassification" and corrected its process, but cites a lengthy investigation period as justification for contesting the tax demand.

Volkswagen's VOWG_p.DE domestic unit, Skoda Auto Volkswagen, Kia and India's tax department did not respond to queries from Reuters.

The Mumbai High Court is expected to decide within days the outcome of Volkswagen's challenge to its own tax demand.

Volkswagen blames India for taking as long as 12 years to review some shipment records, but tax authorities say the investigation delay came about as the company did not provide necessary documents in time.

The company has also argued the tax demand is contradictory to New Delhi's own tax rules on imports of car parts. Lawyers for the two sides have sparred in recent court hearings over how imports should be classified.

"Don't be the victim here," N. Venkataraman, India's additional solicitor general, said in court last week, while criticising Volkswagen. "If you don't follow the law then we will initiate action."

(Reporting by Arpan Chaturvedi and Aditya Kalra and Aditi Shah; Additional reporting by Nikunj Ohri in New Delhi; Editing by Clarence Fernandez)

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Repeats for Indian morning readership, no change to text.

By Aditi Shah

NEW DELHI, Feb 21 (Reuters) - India's EV policy, which offers import tax cuts for foreign automakers investing in the country, will restrict them from using funds spent on charging infrastructure for such relief, increasing their car manufacturing, a government document shows.

India last year announced a policy aimed at attracting Tesla TSLA.O to manufacture EVs in the country and let such foreign carmakers import cars at a 15% tariff, from around 100% now, but only if they invest at least $500 million for a factory.

But the policy will mandate that automakers can count only 5% of their total EV investment as coming from creation of charging infrastructure, even if they spend much more on the power network, according to government document detailing draft rules which is not public but was seen by Reuters.

The government's plan comes just as Tesla gets closer to entering India with imported cars, having finalised two locations for showrooms. The restriction could upset those automakers who may want to invest a bigger chunk of their planned India investments into creating charging networks, which remain far and few in India.

An industry source privy to discussions with the government said the call is being taken as New Delhi wants companies to prioritise manufacturing, and not just charging networks.

In India's nascent EV market, many buyers have shied away from making purchases due to lack of fast chargers.

"Expenditure incurred on charging infrastructure would be considered up to (a) maximum 5% of the committed investment," the 47-page draft document from January 2025 stated.

The government is holding consultations with carmakers and other stakeholders on the draft rules and will finalise them by next month, said a source with direct knowledge of the matter.

India's ministry of heavy industries, which is spearheading the new policy, did not respond to an email seeking comment.

Tesla in a job advert last week said it is also looking for a "charging developer" who would "develop and manage pipeline of new charging" sites, and select locations for deployment.

The EV giant's chief Elon Musk put on hold his manufacturing investment plans for India last year, amid falling electric car sales globally.

Tesla's immediate India plan is to import cars and sell them in India. Musk and U.S. President Donald Trump however have repeatedly said India's tariffs for cars are too high.

The new draft rules said companies which commit to India manufacturing will also need to meet a minimum turnover of $577 million by the end of the fourth year of operation, and $866 million by the fifth year, to be eligible for lower tariffs on up to 8,000 electric cars per year.

If they fail to do so, they will need to pay a penalty of between 1%-3% of the revenue shortfall.

Other foreign automakers like Hyundai 005380.KS, HYUN.NS and Toyota Motor 7203.T have shown interest in making EVs in India at their existing and new factories.

(Reporting by Aditi Shah; editing by David Evans)

(([email protected]; +91-11-4954 8023, +91-11-3015 8023; Reuters Messaging: twitter: @aditishahsays))

By Aditi Shah

NEW DELHI, Feb 21 (Reuters) - India's EV policy, which offers import tax cuts for foreign automakers investing in the country, will restrict them from using funds spent on charging infrastructure for such relief, increasing their car manufacturing, a government document shows.

India last year announced a policy aimed at attracting Tesla TSLA.O to manufacture EVs in the country and let such foreign carmakers import cars at a 15% tariff, from around 100% now, but only if they invest at least $500 million for a factory.

But the policy will mandate that automakers can count only 5% of their total EV investment as coming from creation of charging infrastructure, even if they spend much more on the power network, according to government document detailing draft rules which is not public but was seen by Reuters.

The government's plan comes just as Tesla gets closer to entering India with imported cars, having finalised two locations for showrooms. The restriction could upset those automakers who may want to invest a bigger chunk of their planned India investments into creating charging networks, which remain far and few in India.

An industry source privy to discussions with the government said the call is being taken as New Delhi wants companies to prioritise manufacturing, and not just charging networks.

In India's nascent EV market, many buyers have shied away from making purchases due to lack of fast chargers.

"Expenditure incurred on charging infrastructure would be considered up to (a) maximum 5% of the committed investment," the 47-page draft document from January 2025 stated.

The government is holding consultations with carmakers and other stakeholders on the draft rules and will finalise them by next month, said a source with direct knowledge of the matter.

India's ministry of heavy industries, which is spearheading the new policy, did not respond to an email seeking comment.

Tesla in a job advert last week said it is also looking for a "charging developer" who would "develop and manage pipeline of new charging" sites, and select locations for deployment.

The EV giant's chief Elon Musk put on hold his manufacturing investment plans for India last year, amid falling electric car sales globally.

Tesla's immediate India plan is to import cars and sell them in India. Musk and U.S. President Donald Trump however have repeatedly said India's tariffs for cars are too high.

The new draft rules said companies which commit to India manufacturing will also need to meet a minimum turnover of $577 million by the end of the fourth year of operation, and $866 million by the fifth year, to be eligible for lower tariffs on up to 8,000 electric cars per year.

If they fail to do so, they will need to pay a penalty of between 1%-3% of the revenue shortfall.

Other foreign automakers like Hyundai 005380.KS, HYUN.NS and Toyota Motor 7203.T have shown interest in making EVs in India at their existing and new factories.

(Reporting by Aditi Shah; editing by David Evans)

(([email protected]; +91-11-4954 8023, +91-11-3015 8023; Reuters Messaging: twitter: @aditishahsays))

This is a repeat of an item issued on Wednesday

By Aditya Kalra, Aditi Shah and Nikunj Ohri

NEW DELHI, Feb 12 (Reuters) - India's demand for back taxes running into a record $1.4 billion from Volkswagen, after 12 years of scrutiny, is reigniting concerns that lengthy investigations and litigation could sour the plans of foreign firms in the fastest-growing major economy.

Automakers such as Maruti Suzuki MRTI.NS, Hyundai 005380.KS, Honda 7267.T and Toyota 7203.T face demands for about $6 billion collectively in disputes on income-tax, customs and other payments that go back years, a Reuters analysis shows.

Although Prime Minister Narendra Modi has been courting foreign investors with promises to simplify regulations and uproot bureaucratic hurdles, lengthy tax investigations remain a sore point, often triggering lawsuits that stretch over years.

In one high-profile incident, telecoms company Vodafone won its case against a $2-billion retrospective Indian tax demand after more than a decade of legal battles with New Delhi, including international arbitration at the Hague.

Now, Volkswagen's move on January 29 to sue India for $1.4 billion in tax that the firm called "impossibly enormous" is making foreign companies jittery.

Tax advisers and lawyers say they are fielding nervous queries from clients about how years-old tax cases could come back to haunt them.

Calls are also growing for an amnesty scheme for cases running for years, as India set a three-year window on February 1 to conclude reviews of customs shipments, but the rule excludes old disputes running into billions of dollars.

"The government clearly recognised this now and redressed it, but it is unlikely old tax demand notices will be given any benefit," said Ameya Dadhich, a tax associate at global law firm DLA Piper.

"Such instances can deter foreign companies from investing heavily in India," he added. "An amnesty scheme will be helpful given that around 40,000 tariff disputes are pending."

India's finance ministry did not respond to queries from Reuters.

Modi wants to turn India into a manufacturing hub, but many electronic and auto companies rely on assembly operations using parts for high-end cars or smartphones imported from markets such as China and Europe, often spurring investigations.

Government data shows total pending arrears of service tax, customs and excise levies stood at nearly $53 billion in November 2024, with a whopping 70% disputed in litigation.

In the category of import tariff, or customs disputes alone, India had made tax demands of $4.5 billion by March 2024, with a third of those pending for more than five years.

One tax adviser and a lawyer for a foreign automaker in India said the Volkswagen news sparked a flurry of calls from companies to gather updates on scrutiny of their shipments, to ensure their imports are classified correctly for tax.

TAX BACKLOG

In a move seen as aimed at placating U.S. President Donald Trump, who once called India a "tariff king", New Delhi cut average tariffs on February 1 to 11% from 13%, though they still exceed those of China, Japan and the United States.

Imports of fully built luxury cars face Indian taxes and levies of about 100%, while the rate is 150% for Scotch whisky and wine.

In the highly competitive auto sector, Volkswagen VOWG_p.DE is not alone in facing tax scrutiny.

Maruti has $2.4 billion of tax demands in dispute, with at least one case concerning transactions from 1986. Volkswagen is locked in tussles over $1.2 billion, apart from the most recent demand, while Hyundai faces $488 million in such demands.

India's appeals tribunal for customs, excise and service tax faced a backlog of 80,000 cases, Sanjay Malhotra, then the revenue secretary, said in 2023. With about 20,000 new cases each year, he said, "We are not able to reduce the backlog."

In the case of Volkswagen, New Delhi accuses it of having imported most parts of 14 models in separate shipments before assembling them locally, paying tax ranging from 5% to 15%.

That strategy circumvented the tax of 30% to 35% payable if the same items were imported in a single shipment as a completely knocked down (CKD) unit.

In its court filing to be heard this month in the financial capital of Mumbai, Volkswagen is blaming Indian officials for their "inaction and tardiness" in taking years to review shipment records, some stretching back to 2012.

Had New Delhi wrapped up its reviews earlier, Volkswagen says, it could have challenged the move or re-evaluated its import strategy, but the tax notice now puts "at peril the very foundation of faith and trust" foreign investors desire.

Two government officials who spoke on condition of anonymity said the slowness of Indian bureaucracy and a lack of adequate documentation from Volkswagen both contributed to the delay.

"Long pendency like in Volkswagen's case has a detrimental effect on business," said Shashi Mathews, head of indirect tax practice at Indian law firm, IndusLaw.

"We are seeing an increase in queries from clients wanting to know the fate of their shipment reviews."

(Reporting by Aditi Shah, Nikunj Ohri and Aditya Kalra; Additional reporting by Arpan Chaturvedi; Editing by Clarence Fernandez)

((Email: [email protected]; X: @adityakalra;))

By Aditya Kalra, Aditi Shah and Nikunj Ohri

NEW DELHI, Feb 12 (Reuters) - India's demand for back taxes running into a record $1.4 billion from Volkswagen, after 12 years of scrutiny, is reigniting concerns that lengthy investigations and litigation could sour the plans of foreign firms in the fastest-growing major economy.

Automakers such as Maruti Suzuki MRTI.NS, Hyundai 005380.KS, Honda 7267.T and Toyota 7203.T face demands for about $6 billion collectively in disputes on income-tax, customs and other payments that go back years, a Reuters analysis shows.

Although Prime Minister Narendra Modi has been courting foreign investors with promises to simplify regulations and uproot bureaucratic hurdles, lengthy tax investigations remain a sore point, often triggering lawsuits that stretch over years.

In one high-profile incident, telecoms company Vodafone won its case against a $2-billion retrospective Indian tax demand after more than a decade of legal battles with New Delhi, including international arbitration at the Hague.

Now, Volkswagen's move on January 29 to sue India for $1.4 billion in tax that the firm called "impossibly enormous" is making foreign companies jittery.

Tax advisers and lawyers say they are fielding nervous queries from clients about how years-old tax cases could come back to haunt them.

Calls are also growing for an amnesty scheme for cases running for years, as India set a three-year window on February 1 to conclude reviews of customs shipments, but the rule excludes old disputes running into billions of dollars.

"The government clearly recognised this now and redressed it, but it is unlikely old tax demand notices will be given any benefit," said Ameya Dadhich, a tax associate at global law firm DLA Piper.

"Such instances can deter foreign companies from investing heavily in India," he added. "An amnesty scheme will be helpful given that around 40,000 tariff disputes are pending."

India's finance ministry did not respond to queries from Reuters.

Modi wants to turn India into a manufacturing hub, but many electronic and auto companies rely on assembly operations using parts for high-end cars or smartphones imported from markets such as China and Europe, often spurring investigations.

Government data shows total pending arrears of service tax, customs and excise levies stood at nearly $53 billion in November 2024, with a whopping 70% disputed in litigation.

In the category of import tariff, or customs disputes alone, India had made tax demands of $4.5 billion by March 2024, with a third of those pending for more than five years.

One tax adviser and a lawyer for a foreign automaker in India said the Volkswagen news sparked a flurry of calls from companies to gather updates on scrutiny of their shipments, to ensure their imports are classified correctly for tax.

TAX BACKLOG

In a move seen as aimed at placating U.S. President Donald Trump, who once called India a "tariff king", New Delhi cut average tariffs on February 1 to 11% from 13%, though they still exceed those of China, Japan and the United States.

Imports of fully built luxury cars face Indian taxes and levies of about 100%, while the rate is 150% for Scotch whisky and wine.

In the highly competitive auto sector, Volkswagen VOWG_p.DE is not alone in facing tax scrutiny.

Maruti has $2.4 billion of tax demands in dispute, with at least one case concerning transactions from 1986. Volkswagen is locked in tussles over $1.2 billion, apart from the most recent demand, while Hyundai faces $488 million in such demands.

India's appeals tribunal for customs, excise and service tax faced a backlog of 80,000 cases, Sanjay Malhotra, then the revenue secretary, said in 2023. With about 20,000 new cases each year, he said, "We are not able to reduce the backlog."

In the case of Volkswagen, New Delhi accuses it of having imported most parts of 14 models in separate shipments before assembling them locally, paying tax ranging from 5% to 15%.

That strategy circumvented the tax of 30% to 35% payable if the same items were imported in a single shipment as a completely knocked down (CKD) unit.

In its court filing to be heard this month in the financial capital of Mumbai, Volkswagen is blaming Indian officials for their "inaction and tardiness" in taking years to review shipment records, some stretching back to 2012.

Had New Delhi wrapped up its reviews earlier, Volkswagen says, it could have challenged the move or re-evaluated its import strategy, but the tax notice now puts "at peril the very foundation of faith and trust" foreign investors desire.

Two government officials who spoke on condition of anonymity said the slowness of Indian bureaucracy and a lack of adequate documentation from Volkswagen both contributed to the delay.

"Long pendency like in Volkswagen's case has a detrimental effect on business," said Shashi Mathews, head of indirect tax practice at Indian law firm, IndusLaw.

"We are seeing an increase in queries from clients wanting to know the fate of their shipment reviews."

(Reporting by Aditi Shah, Nikunj Ohri and Aditya Kalra; Additional reporting by Arpan Chaturvedi; Editing by Clarence Fernandez)

((Email: [email protected]; X: @adityakalra;))

Feb 6 (Reuters) - Indian tyre maker MRF MRF.NS posted a near 40% fall in third-quarter profit on Thursday, as higher rubber costs outweighed steady demand for tyre, sending its shares more than 3% lower.

Standalone net profit was 3.07 billion rupees ($35.06 million) in the quarter ended Dec. 31, missing analysts' average estimate of 4.2 billion rupees, according to LSEG data.

Revenue from operations rose 13.8% to 68.83 billion rupees, beating analysts' average estimate of 67.33 billion rupees, while total expenses increased 20.6%.

MRF makes tyres for vehicles of Hyundai Motor India HYUN.NS and Bajaj Auto BAJA.NS, among others.

For further earnings highlights, click (Full Story)

KEY CONTEXT

Prices of rubber, a key raw material for tyre makers, rose in the December quarter, analysts said. Cost of materials consumed rose 23.8% to 46.34 billion rupees for MRF.

Total vehicle sales in India rose 3.1% year-on-year in the reported quarter, compared with a 19.5% jump in the year-earlier period. This weighed on tyre makers such as MRF, which depend on auto sales for a big chunk of their revenue.

Meanwhile, replacement demand, where customers change old or worn-out tyres with new ones, along with price hikes helped boost revenue, analysts said.

PEER COMPARISON

* The mean of analysts' ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell

** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the PT

OCTOBER-DECEMBER STOCK PERFORMANCE

-- All data from LSEG

-- $1 = 87.5575 Indian rupees

(Reporting by Meenakshi Maidas in Bengaluru; Editing by Subhranshu Sahu)

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By Nikunj Ohri, Aditya Kalra and Aditi Shah

NEW DELHI, Feb 5 (Reuters) - India has accused South Korea's Kia of evading taxes of $155 million by misclassifying component imports but the carmaker has denied wrongdoing, the latest fight by a foreign automaker with New Delhi over tariffs, according to a document and two sources.

Kia competes with Hyundai 005380.KS and Maruti Suzuki MRTI.NS in the world's third-largest auto market, where it has a share of 6% of roughly 4 million units a year, and its Kia Seltos and Sonet SUVs are among the top sellers.

Foreign companies in India face headaches from high taxes and long-drawn-out investigations.

For example, Tesla TSLA.O has publicly complained about high taxes on imported EVs and Volkswagen VOWG_p.DE last week sued over a demand for a record $1.4 billion in back taxes that it called "impossibly enormous".

Tax officers sent a confidential notice to Kia's Indian unit in April 2024, flagging alleged tax evasion of 13.5 billion rupees, according to a government notice Reuters is reporting for the first time.

The offence centred on incorrect declaration of imports of components for the assembly of the carmaker's luxury Carnival minivan, the notice showed.

In a statement to Reuters, Kia India said it made "a detailed response, supported by comprehensive evidence and documentation to substantiate" its stand and the authorities were still reviewing the matter.

Kia India is committed to complying with all regulations and has "consistently cooperated with" authorities, it added.

India's finance ministry and customs officials did not respond to Reuters queries.

In its 432-page notice, the government said tax authorities found Kia's Carnival "car model was being imported in parts or components in separate lots" via different ports, with the "intent to discharge lesser customs duty".

Kia devised the strategy to ensure the imports "could not (be) detected by customs," it added in the notice, issued by a customs commissioner in the southern city of Chennai.

Two sources said Kia's 000270.KS case was similar to that of Volkswagen, accused of evading a higher tax of 30% to 35% applicable on parts imported in "completely knocked down" or CKD form in a single shipment, instead shipping separate parts over days, making them eligible for a tax rate of just 10% to 15%.

During the investigation, Kia's website showed the Carnival model sold in India as being in "CKD" form, with retail sales of 9,887 units between 2020 and 2022, the tax notice said.

The Volkswagen investigation spanned 14 car models from the Skoda Kodiaq to the Audi A3 and the Volkswagen Tiguan.

In contrast, Kia's case concerns only the Carnival model, a seven-seater priced around $73,500, which is among its most expensive cars in India.

KIA COULD FACE $310 MLN PAYOUT

Indian tax rules could require Kia to pay up to $310 million if it loses the dispute, or roughly double the amount evaded, due to penalty and interest.

The latest available corporate filings in India show Kia's domestic annual sales of $4.45 billion in fiscal 2022/23 were its highest ever, up 53% on the year, for net profit of $243 million.

Last week, India slashed import duties on fully-built high-end motorcycles to 30%, in a move widely seen as looking to placate U.S. President Donald Trump, who has in the past called India a "tariff king".

But fully-assembled imported cars still attract a levy of more than 100%.

Kia has deposited 2.78 billion rupees ($32 million) "under protest" as it continues to fight the Indian tax notice, which is still proceeding, said a government source who declined to be named as the matter is private.

In 2022, authorities searched Kia offices and a factory in the southern state of Andhra Pradesh and took statements from India executives, some of whom the document identifies as Chief Procurement Officer Lee Sang Hwa, and Chief Finance Officer Kiho Yoo.

During the investigation, Kia executives "changed their stance and have made efforts to mislead," the tax notice stated, referring to statements on imports, manufacturing and taxation.

Kia was accused of importing more than 90% of the parts for Carnival, constituting a car in CKD form, which attracts higher tax, it added.

India's head of indirect taxes, Sanjay Kumar Agarwal, told Reuters the law was clear and some automakers were flouting it by not paying applicable CKD duties.

"If they are on the wrong side, then the department will have to issue a notice," he said in an interview on Tuesday.

(Reporting by Nikunj Ohri, Aditya Kalra and Aditi Shah; Additional reporting by Munsif Vengattil; Editing by Clarence Fernandez)

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Feb 1 (Reuters) - India's overall car sales to dealers saw a slight increase in January, data released by automakers on Saturday showed, as inflation-wary customers continued to delay purchases.

Domestic sales of India's top four carmakers - which form 80% of the country's car market - rose 1.8% from a year ago, helped by sales of market leader Maruti Suzuki's MRTI.NS small cars and Mahindra & Mahindra's MAHM.NS sports utility vehicles.

Peers Hyundai India HYUN.NS and Tata Motors TAMO.NS saw sales declining 5.5% and 10%, respectively, hurt by increased competition.

WHY IT'S IMPORTANT

Car sales in India, the world's third-largest car market, have slowed after two years of rapid growth as higher inflation has squeezed buyers' pockets.

Higher raw material costs have forced carmakers to raise prices even as they offer discounts to perk up demand.

The government's proposal to slash personal income tax rates in its annual budget on Saturday has raised hopes of a consumption boost in the world's fifth-largest economy, which could possibly entice more people to buy cars.

India's auto index .NIFTYAUTO rallied on the day, settling 1.9% higher.

BY THE NUMBERS

*Exports included

(Reporting by Nandan Mandayam in Bengaluru; Editing by Mrigank Dhaniwala)

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Adds details throughout

Jan 29 (Reuters) - Maruti Suzuki MRTI.NS, India's top carmaker by volumes, missed third-quarter profit expectations on Wednesday, hurt by higher discounts and a dip in small car sales.

Following two years of rapid growth, Indian automakers faced pressure throughout much of 2024 due to weak demand for new cars and rising costs, which led them to provide bigger discounts.

Analysts also noted that discounts during the quarter increased, driven by year-end sales incentives and promotions during the festive season.

The 'Alto' maker's standalone profit rose 12.6% year-on-year to 35.25 billion rupees ($407.3 million) for the quarter ended Dec. 31, but missed analysts' estimates of 36.62 billion rupees, per data compiled by LSEG.

However, Maruti's revenue grew 15.5% to 368.02 billion rupees, boosted by the sale of pricier and higher margin utility vehicles, which mainly comprise of sport utility vehicles (SUV).

Maruti's utility vehicles sales rose 20.2% in the reported quarter.

Sales in its largest small car segment, which includes popular models like the 'WagonR' and 'Swift,' fell by 3.7% in a market that is increasingly favouring sport utility vehicles.

Smaller cars or hatchbacks made up for about 30% of sales in India in the third quarter, while utility vehicles comprised about 67%.

Maruti's total expenses rose 15.5% as costs related to clearing inventory came in at 6.8 billion rupees, a significant increase compared to an income of 22 million rupees during the same period last year.

Its bottomline was also hurt by higher sales promotion expenses, the company said.

Last month, the New Delhi-headquartered firm said it was hiking prices across its range of cars to cope with rising costs.

Its shares, which were trading 0.2% higher before the results, reversed course and were down 1% as of 2:44 p.m. IST.

($1 = 86.5375 Indian rupees)

(Reporting by Meenakshi Maidas in Bengaluru; Editing by Sonia Cheema)

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Adds domestic demand outlook, export plans in paragraphs 1, 5, 9-10

By Nandan Mandayam

Jan 28 (Reuters) - Hyundai Motor India HYUN.NS reported a lower third-quarter profit on Tuesday, hurt by easing domestic sales and exports alongside higher discounts, and said it expects industry-wide car sales to remain tepid next fiscal year.

Hyundai is India's second-biggest carmaker and its 14% market share trails only Maruti Suzuki's MRTI.NS 40%. The Korean carmaker counts India among its top markets globally.

While its domestic sales dipped 0.1%, exports slid 7.5%, bringing down overall sales by 2.4%. That led to a 1.3% revenue dip, while profit declined about 19% to 11.61 billion rupees (about $134 million).

The 'Creta' sport utility vehicle (SUV) manufacturer is the first carmaker to report quarterly earnings in the world's third-largest auto market, where demand has tapered after surging in the last few years.

"Broadly, we believe low-single digit growth (of industry-wide domestic car sales) should continue in 2025-26 as well," Hyundai Motor India Chief Operating Officer Tarun Garg told reporters.

Car sales in India have stalled in this fiscal year, growing just 1.8% between April and December 2024, far slower than the 7.4% rise seen in the same period a year earlier.

They grew 4.5% in the October-December quarter, helped by India's demand-driving festival season and high discounts.

Hyundai's sales, however, dipped as heightened competition trimmed sales growth of its margin-boosting SUVs to 4%, from a 34.5% growth in the year-ago quarter.

Chief Executive Officer Unsoo Kim told reporters that Hyundai India was boosting exports to Africa to offset the impact of lower shipments to its key Middle East market.

Hyundai India sells a little over three-fourths of its cars in India, and exports the rest to the Middle East, South Africa, and parts of Latin America.

Rivals Maruti Suzuki and Tata Motors TAMO.NS will report their December quarter results on Wednesday.

($1 = 86.5330 Indian rupees)

(Reporting by Meenakshi Maidas and Nandan Mandayam in Bengaluru; Editing by Savio D'Souza and Mrigank Dhaniwala)

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repeats earlier story, no changes

By Aditi Shah

NEW DELHI, Jan 22 (Reuters) - Tata Motors, India's biggest electric car maker, is betting that locally manufactured EV batteries will help it maintain its edge in an industry where competition is intensifying with new launches, its group CFO said in an interview.

Tata's TAMO.NS EV market lead shrunk to 62% in 2024 from 73% a year ago as rival JSW MG Motor gained share with its new cars. This year, Mahindra & Mahindra, Hyundai Motor and market leader Maruti Suzuki will also launch EVs in India. Global EV giant Tesla TSLA.O has long eyed India too.

Tata Group's $1.5 billion initial investment to build a battery gigafactory in India and supply Tata Motors will allow it to further integrate its supply chain, P.B. Balaji, group CFO at Tata Motors, told Reuters.

"The work on the entire ecosystem is something that we have. We will be a dominant player in this market," Balaji said on the sidelines of India's car show last week where EVs from domestic players as well as China's BYD 002594.SZ and Vietnam's Vinfast 0TL.F took centre stage.

Tata, the owner of Britain's iconic Jaguar Land Rover, has EV models ranging from around $10,000 up to $27,000 and draws on other group companies that supply components and set up chargers to keep its investment and costs low.

When Agratas, the battery arm of the $165 billion Tata Group, begins production of lithium-ion battery cells in 2026, Tata Motors will have greater control over the most expensive part of an EV.

"Launching a car is a given but can you sustain it forever? We are backend secured," Balaji said, adding that production at the plant in western Gujarat will be at "full blast" in 2028.

New entrants Mahindra MAHM.NS, Maruti MRTI.NS and Hyundai 005380.KS, HYUN.NS do not have a similar integrated supply chain and will source batteries and other parts from suppliers in the market.

Tata Motors is also well funded to withstand a competitive market, Balaji said. It has received $1 billion in funding from U.S. private equity firm TPG and is a beneficiary of India's incentive program for EVs under which it hopes to get about $750 million over the next four years. The first tranche of $17 million has come in, Balaji said.

"There is enough and more money. The full TPG monies have come in, the business is well funded and as battery prices start coming off, most of it starts self-funding," he said.

EV sales in India made up just 2.5% of the 4.3 million cars sold in the country in 2024, but their 20% growth rate outpaced the 5% overall car market growth. Analysts expect EV sales to double in 2025 from 100,000 last year, mainly due to new launches.

Electric models made up about 12% of Tata Motors' 2024 car sales and it wants to grow this to 30% by 2030, it has said.

(Reporting by Aditi Shah, additional reporting by Nandan Mandayam;Editing by Elaine Hardcastle)

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By Aditi Shah

NEW DELHI, Jan 22 (Reuters) - Tata Motors, India's biggest electric car maker, is betting that locally manufactured EV batteries will help it maintain its edge in an industry where competition is intensifying with new launches, its group CFO said in an interview.

Tata's TAMO.NS EV market lead shrunk to 62% in 2024 from 73% a year ago as rival JSW MG Motor gained share with its new cars. This year, Mahindra & Mahindra, Hyundai Motor and market leader Maruti Suzuki will also launch EVs in India. Global EV giant Tesla TSLA.O has long eyed India too.

Tata Group's $1.5 billion initial investment to build a battery gigafactory in India and supply Tata Motors will allow it to further integrate its supply chain, P.B. Balaji, group CFO at Tata Motors, told Reuters.

"The work on the entire ecosystem is something that we have. We will be a dominant player in this market," Balaji said on the sidelines of India's car show last week where EVs from domestic players as well as China's BYD 002594.SZ and Vietnam's Vinfast 0TL.F took centre stage.

Tata, the owner of Britain's iconic Jaguar Land Rover, has EV models ranging from around $10,000 up to $27,000 and draws on other group companies that supply components and set up chargers to keep its investment and costs low.

When Agratas, the battery arm of the $165 billion Tata Group, begins production of lithium-ion battery cells in 2026, Tata Motors will have greater control over the most expensive part of an EV.

"Launching a car is a given but can you sustain it forever? We are backend secured," Balaji said, adding that production at the plant in western Gujarat will be at "full blast" in 2028.

New entrants Mahindra MAHM.NS, Maruti MRTI.NS and Hyundai 005380.KS, HYUN.NS do not have a similar integrated supply chain and will source batteries and other parts from suppliers in the market.

Tata Motors is also well funded to withstand a competitive market, Balaji said. It has received $1 billion in funding from U.S. private equity firm TPG and is a beneficiary of India's incentive program for EVs under which it hopes to get about $750 million over the next four years. The first tranche of $17 million has come in, Balaji said.

"There is enough and more money. The full TPG monies have come in, the business is well funded and as battery prices start coming off, most of it starts self-funding," he said.

EV sales in India made up just 2.5% of the 4.3 million cars sold in the country in 2024, but their 20% growth rate outpaced the 5% overall car market growth. Analysts expect EV sales to double in 2025 from 100,000 last year, mainly due to new launches.

Electric models made up about 12% of Tata Motors' 2024 car sales and it wants to grow this to 30% by 2030, it has said.

(Reporting by Aditi Shah, additional reporting by Nandan Mandayam;Editing by Elaine Hardcastle)

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Jan 21 (Reuters) - Hyundai Motor Co 005380.KS:

• HYUNDAI MOTOR INDIA - ACHIEVED UP TO 92% LOCALIZATION IN MANUFACTURING

Source text: ID:nNSERCZCq

Further company coverage: 005380.KS

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Jan 18 (Reuters) - HYUNDAI MOTOR AND TVS MOTOR ANNOUNCE COLLABORATION FOR MICROMOBILITY VEHICLES AT INDIA CAR SHOW

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(Reporting by Siddhi Nayak)

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Recasts to add details of EV plans by Hyundai and Tata Motors

By Aditi Shah and Nandan Mandayam

NEW DELHI, Jan 17 (Reuters) - Hyundai HYUN.NS, Maruti Suzuki MRTI.NS and Tata Motors TAMO.NS used the India auto show to unveil ambitious plans to expand their electric vehicle charging network to address the issues that are putting customers off making the switch.

The five-day auto show in New Delhi starting on Friday saw carmakers show off their new EVs and India's Prime Minister Narendra Modi make a case for more investment in the world's third-biggest market, where automakers are desperately trying to increase sales and where Tesla TSLA.O has long-delayed its plans to enter.

Fuel-guzzling cars still dominate India's roads, with EV sales rising, but still accounting for just 2.5% of annual sales.

Maruti Suzuki on Friday announced plans to install fast charging points in India's top 100 cities - one every 5-10 kilometres (3.1-6.2 miles) - and consider launching a battery rental service, while Tata Motors and Hyundai said they will set up 500 and 600 public chargers, respectively.

Maruti also announced plans to expand the charging network in cities and provide roadside assistance all over India if a battery runs out.

Anxiety over batteries draining without a charging spot nearby is a big issue for customers in the country.

"We will leverage our vast network to provide fast charging support," Maruti CEO Hisashi Takeuchi said at the show, where it also launched its first EV - the e Vitara SUV.

Maruti is also considering a battery rental service to address what many view as a major obstacle to EV adoption in India.

The move comes after India's Tata Motors TAMO.NS last year started luring consumers with free charging and steep discounts, while rival MG Motor also launched a battery rental plan.

At the New Delhi auto show, electric vehicles will be centre stage, with models from Vietnamese entrant Vinfast 0TL.F on display, alongside domestic brands Maruti and Mahindra & Mahindra MAHM.NS, as well as global rivals BYD 002594.SZ, Toyota 7203.T and Hyundai 005380.KS.

Modi courted investors by saying the government was willing to provide support for companies seeking to expand in the nation.

"This is the right time for you for a large investment in this sector," he said.

India's auto industry, which grew by about 12% last year, will expand further as a result of factors including its large youth population and rapid urbanisation, Modi said.

But there have been challenges. India plans to expand EV incentives to automakers and relax its policy which was originally designed following lobbying by Tesla, which has still not entered the market, Reuters reported in November.

(Additional reporting by Kashish Tandon and Sakshi Dayal; Writing by Indranil Sarkar and Aditya Kalra; Editing by Kate Mayberry, Ros Russell and Louise Heavens)

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Adds graphic on slowing EV sales growth

By Aditi Shah and Nandan Mandayam

NEW DELHI, Jan 16 (Reuters) - Automakers operating in India plan to launch close to a dozen new electric car models this year, many in the premium market, with longer driving ranges and faster charging times, to attract buyers as demand for EVs slows down globally.

Electric cars will take centre stage at India's five-day auto show in New Delhi starting Friday with models from new Vietnamese entrant Vinfast 0TL.F shown alongside domestic brands Maruti Suzuki MRTI.NS and Mahindra & Mahindra MAHM.NS as well as global rivals BYD 002594.SZ, Toyota 7203.T and Hyundai 005380.KS.

India's EV market leaders Tata Motors TAMO.NS and JSW-MG Motor, part-owned by China's SAIC Motor 600104.SS, will showcase an expanded line-up in the world's third-largest car market where tighter emission norms starting from 2027 are forcing a move to cleaner cars.

India's EV market is small, with electric models making up about 2.5% of the 4.3 million cars sold in 2024 as high prices and a patchy charging network hold back buyers.

The government wants to grow this to 30% by 2030.

Globally, electric car sales growth slowed to 13% in 2024 from a year ago but crossed 10 million units for the first time, according to data from research firm RhoMotion.

While EV sales growth in India is also slowing, rising 20% in 2024 from a year ago to about 100,000 units, it outpaced the overall car market growth of 5% over the same period.

Auto industry executives say new models with longer ranges and faster charging times could lift demand, with analysts forecasting electric car sales in India to double this year.

The first EVs in India, mostly from market leader Tata Motors, were gasoline cars converted to electric, delivering a range of up to 300 kilometres (186 miles) on a single charge, which many found inadequate for inter-city journeys.

The majority of new launches are designed as EVs from the start at a minimum range of 400 km. Some automakers, such as Mahindra, are offering more than 600 km and fast charging from 20%-80% in under 20 minutes.

Mahindra's two electric SUV launches for this year are priced at $22,000 to $35,000. The average price of a car in India is around $12,000, with more expensive models growing at a faster pace than affordable ones.

EV maker VinFast, which is building a car factory in southern India, will display its mini-SUV VF3, a three-row MPV, the VF9, among others.

"India's burgeoning middle class, coupled with strong government incentives to promote EV adoption, makes it a natural focus for VinFast's global expansion," the carmaker said.

South Korea's Hyundai HYUN.NS will showcase the India-built electric version of its popular Creta SUV, which it hopes will help take on rivals, while BYD will display its Sealion 7 electric SUV.

Maruti, India's largest carmaker by sales, will display its first EV, the e Vitara SUV which will launch later this year. The car has been jointly developed by Maruti's parent Suzuki Motor 7269.T and Toyota.

Some carmakers also plan to show other clean fuel technologies such as plug-in hybrid cars, flex-fuel models, hydrogen fuel cell vehicles and gas-based cars alongside EVs.

"The path to a faster electric takeoff really works better if you have all electrified vehicles being encouraged in a proportionate manner," said Vikram Gulati, country head and executive vice president for corporate affairs and governance at Toyota's India unit.

(Reporting by Aditi Shah, Editing by Louise Heavens)

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Jan 14 (Reuters) - India's car sales by manufacturers to dealers grew 4.2% in 2024, their slowest pace in four years, industry data showed on Tuesday, as demand for new cars cooled off amid high inflation.

Sales of passenger vehicles, which include small cars, sedans and sport utility vehicles (SUV), rose to a record 4.27 million units from January to December last year, compared to 4.11 million units in 2023, according to the Society of Indian Automobile Manufacturers, an industry body.

However, sales of small cars dipped 14.4% as their prices exceeded the income levels of their target customers, car manufacturers said. Sales of SUVs and large cars, on the other hand, grew 16.8% last year, albeit slower than the 22% jump they clocked in 2023.

Small cars comprise one-third of total car sales in India, while SUVs and other big cars form the rest.

Manufacturers and dealers were forced to dish out higher discounts in the latter half of 2024.

Analysts expect car sales growth to pick up pace in 2025 on the back of new model launches that are expected to boost demand as well as expectations of an interest rate cut.

(Reporting by Nandan Mandayam in Bengaluru; Editing by Sonia Cheema)

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Jan 8 (Reuters) - Hyundai Motor Co 005380.KS:

• HYUNDAI MOTOR INDIA LTD - INTRODUCES NEW VARIANTS AND UPGRADES FOR VENUE, VERNA, GRAND I10 NIOS

Source text: ID:nBSE9NjgZP

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By Nandan Mandayam

Jan 7 (Reuters) - Indian car dealers clocked a surprise 2% drop in sales in December, with high year-end discounts boosting demand only for a handful of showroom owners, a dealers' body said on Tuesday.

Sales dropped to 293,465 units in the month from 299,351 units last year, according to data from the Federation of Automobile Dealers Association (FADA).

At the start of December, about 80% of FADA's members had said in an online survey that they expected sales to be flat to higher for the month, recovering from a 14% drop in November.

However, demand failed to pick up in the final week of the month, which often accounts for 30-40% of a dealership's sales, FADA President C S Vigneshwar told Reuters.

"While some dealers benefited from year-end schemes and expanded product ranges, overall demand remained subdued," Vigneshwar said in a press release.

Dealers have struggled with tepid demand in the latter half of 2024 following two years of strong growth, forcing them to increase discounts.

Nonetheless, carmakers sales to dealers increased last month, most notably at market leader Maruti Suzuki MRTI.NS, which reported a discount-driven rebound in small-car sales.

The demand for Mahindra & Mahindra's MAHM.NS sport utility vehicles remained strong. Hyundai India's HYUN.NS sales dipped, while Tata Motors' TAMO.NS increased slightly.

A Maruti official said dealer inventory had significantly dropped.

FADA said the average time a car stayed in a showroom, or inventory days, receded to 55-60 days in December from 65-68 days in November as manufacturers moderated dispatches.

Still, the level is below the FADA-recommended 21 days.

Inventory levels are an indicator of demand. High inventory levels have forced automakers to slow sales to dealers and offer higher discounts.

FADA expects new launches, including those of electric vehicles to spur demand this year, but said manufacturers should "carefully manage their supplies in line with market demand."

(Reporting by Nandan Mandayam in Bengaluru; Editing by Savio D'Souza)

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Jan 1 (Reuters) - Hyundai Motor Co 005380.KS:

• HYUNDAI MOTOR INDIA LTD - HMIL REGISTERS DOMESTIC SALES OF 6,05,433 UNITS IN CY 2024

• HYUNDAI MOTOR INDIA LTD - TOTAL MONTHLY SALES OF 55,078 UNITS IN DECEMBER 2024

Source text: ID:nBSEbncfrb

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** Shares of Amara Raja Energy & Mobility Ltd AMAR.NS rise as much as 4.5% to 1,274.95 rupees

** Battery maker says Hyundai Motor India Ltd HYUN.NS will equip its domestic product line-up with co's absorbent glass mat (AGM) battery technology

** Adds, HYUN aims to equip its models with AGM batteries in Q4 of FY 2024-2025

** Stock on track to snap six days of losses

** More than 544,000 shares traded as of 9:41 a.m. IST, vs their 30-day moving avg of 441,454 shares

** Mean rating of 14 analysts rating the stock is 'hold'; their median PT is 1,531.50 rupees - LSEG data

** AMAR last up 1.4%, adding to YTD gains of 51.7%

(Reporting by Meenakshi Maidas in Bengaluru)

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Dec 19 (Reuters) - Hyundai Motor Co 005380.KS:

• HYUNDAI MOTOR INDIA - RE-APPOINTS UNSOO KIM AS MANAGING DIRECTOR FOR THREE YEARS

Source text: ID:nBSE2zTWdC

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Dec 12 (Reuters) - Indian automaker Tata Motors TAMO.NS said on Thursday it will increase prices of its commercial vehicles, including trucks and buses, by up to 2% from January.

The company had previously said it would raise prices of its cars by 3% in January.

WHY IT'S IMPORTANT

Indian automakers are grappling with rising costs due to strong global commodity prices, high import duties on raw materials and supply chain disruptions.

They have also struggled with slowing sales after years of surging growth, forcing them to offer bigger discounts and moderate sales to dealers.

KEY CONTEXT

Earlier this month, Maruti Suzuki MRTI.NS, India's top carmaker by sales, JSW MG Motor and Hyundai Motor India HYUN.NS also said they would raise prices from January.

BY THE NUMBERS

($1 = 84.8690 Indian rupees)

(Reporting by Manvi Pant in Bengaluru; Editing by Savio D'Souza)

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Dec 11 (Reuters) - Hyundai Motor Co 005380.KS:

• HYUNDAI MOTOR INDIA - GOT ORDER REDUCING ADJUSTMENT TOWARDS ROYALTY

• HYUNDAI MOTOR INDIA - REDUCING ADJUSTMENT TOWARDS ROYALTY FROM 868.8 MILLION RUPEES TO 218.3 MILLION RUPEES

Source text: ID:nNSE5gKlxj

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Dec 9 (Reuters) - Hyundai Motor Co 005380.KS:

• HYUNDAI MOTOR INDIA - TO INSTALL NEARLY 600 FAST PUBLIC EV CHARGERS

• HYUNDAI MOTOR INDIA - EV CHARGERS WILL BE INSTALLED OVER NEXT 7 YEARS

Source text: ID:nNSEcdy925

Further company coverage: 005380.KS

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