We expect revenue to decline around 15 per cent YoY to Rs 18,680 crore due to marginally better ASPs (average selling prices) while profit may fall 18 per cent to Rs 1,470 crore. EBITDA margin is likely to increase 50 basis points on a YoY basis to 11 per cent, largely due to gross margin expansion (around 140 bps) partially offset by higher employee costs. Cost reduction efforts by the company will offset some of the negative operating leverage impact. On a sequential basis, we expect gross margin to expand 200 bps, largely due to reduction in discount levels. Overall, earnings before interest, tax, depreciation, and ammortisation (Ebitda) may come in at around Rs 2,060 crore, a 9 per cent YoY fall from Rs 2,260 crore reported in the corresponding quarter of last fiscal year.
We expect Maruti's revenues to decline around 13 per cent YoY on the back of volume drop. EBITDA margins is expected to remain flat sequentially as benefit from inventorisation, lower discounts is expected to be offset by operating leverage and higher commodity. Revenue may fall 13 per cent YoY to Rs 18,596.5 crore and net profit is expected to decline 17 per cent YoY to Rs 1,496 crore.
We expect revenues to decline by 12 per cent yoy to Rs 18,846.7 crore in 4QFY20, led by 16 per cent yoy decline in volumes and 1 per cent yoy increase in ASPs. Profit may also slip 28 per cent YoY to Rs 1,293.5 crore. We expect EBITDA to decline by 20 per cent in the quarter under study led by 12 per cent yoy decline in revenues and 80 bps decline in EBITDA margin driven by negative operating leverage (-20 bps).
The automobile sector, in general, is likely to report sharply weak Q4FY20, due to planned BS4 inventory correction undertaken by OEMs, lockdown in the month of March owing to the spread of COVID-19, and sharp fall in export volumes. We expect Maruti's topline to de-grow by 15 per cent YoY. We see a significant 40 per cent YoY fall to Rs 1,077.1 crore in earnings for Maruti. Ebitda may slip 28.2 per cent YoY to Rs 1,625.7 crore and EBITDA margin is expected to contract by 164bps YoY to 8.9 per cent owing to negative operating leverage and unfavorable currency movement.