Target: ₹10,693
CMP: ₹8,927.15
In Q4-FY23, Maruti Suzuki India Ltd has reported revenue from operations of ₹32,059.6 crore, up 19.8 per cent YoY and 10.3 per cent QoQ. EBITDA stood at ₹3,351.60 crore, up 37.9 per cent YoY and 18.1 per cent QoQ, while PAT stood at ₹2,670.80 crore, up 42.4 per cent YoY and 11.7 per cent QoQ.
The EBITDA Margins in Q4FY23 stood at 10.4 per cent, up 130bps YoY and 60 bps QoQ. The company delivered robust numbers due to a good market response in the UV segment, and the operating profit improved due to higher sales volume, better realization from the market and favourable forex movement.
MSIL could not completely meet the market demand due to a shortage of electronic components thus reporting production loss of 170,000 units during the year. The company has also announced in principle the creation of an additional capacity of up to 1 million vehicles per year to meet estimated market demand.
We recommend a Buy on MSIL, valuing it at a target price of INR 10,693 with a P/E multiple of 26x using a forecasted EPS of ₹414.68 (FY25). MSIL’s ambition to have the highest market share in the SUV segment will drive growth in the coming years.