Epic Research

Maruti Suzuki (Buy)

CMP: ₹7,332.05

Target: ₹8,441

Maruti Suzuki India is a holding company. The company is engaged in the manufacture, purchase and sale of motor vehicles, components and spare parts (automobiles). The other activities of the Company comprise facilitation of pre-owned car sales, fleet management and car financing. Its geographical segments include the domestic segment, which includes sales to customers located in India, and the overseas segment, which includes sales to customers located outside India. The Company's product portfolio includes Alto 800, Alto K10, Wagon R, Celerio, Ritz, Swift, DZire, Ertiga, Omni, Eeco, Gypsy and Ciaz.

Valuation: Passenger Vehicle Industry has grown at 3.5 per cent CAGR since 2012 as against 6 per cent growth in overall Auto industry. We believe it will pick up due to higher demand from rural areas, higher affordability and availability of better infrastructure. Maruti Suzuki is a must have stock in a portfolio. We look at results and understand that Margins have improved led by cost reduction and localisation programmes. Going ahead with pick up expected in domestic markets company is well placed to capitalize.

Maruti Suzuki a currently available at discount on forward basis. Stock has seen a sharp correction of 33 per cent in recent days. .

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