New launch initiatives, revival of monsoon and benign crude oil prices helped Maruti Suzuki record a new high at the bourses.
The company is launching its first premium crossover S-Cross this weekend and retail chain NEXA next month first week.
Premium crossoverThe stock, which rose about 1 per cent to hit its all-time high of ₹4,225.25 in intraday trades on Friday, closed at ₹4,194.05 on the BSE. The stock’s 52-week low was ₹2,480, registered on July 23, 2014.
MSIL said it will launch the S-Cross, India’s first premium crossover built on a brand new platform. Also, MSIL will launch NEXA, the first of its kind breakthrough modern retail channel that will have an exclusive network of new age automotive showrooms across India. These showrooms will offer a new range of premium vehicles separate from the existing sales channel of MSIL, the company said in a statement.
According to ICICI Securities, the launch of S-Cross and the SUV Compact will help MSIL create a presence in the SUV segment.
The diesel variant of Celerio and the AMT-based Swift model would help improve market share.
“Hence, strong product pipeline of new launches and facelifts of some of its existing models coupled with further enhancement of distribution network and production capacity will help MSIL maintain its leadership position in passenger vehicles even as competition intensifies,” it added.
Volume growthAccording to global financial advisory firm Nomura, volume growth recovery for four-wheeler companies will be much stronger, going ahead.
Analysts are also bullish on the performance of Maruti Suzuki India.
Nirmal Bang expects Maruti Suzuki India to post a sharp 440 bps y-o-y and 24 bps q-o-q expansion in margins on favourable forex rate movements/ richer product mix and soft commodity prices.
Tushar Pendharkar of Right Horizons Financial Services, said: “Despite expansion and slowdown in the economy, Maruti Suzuki managed its debt comfortably and reported positive operating cash flow, which could be used in further expansion.”
Another big positive for the stock is the fall in crude oil prices. An accord to ease sanctions on Iran, helped further fall in crude oil price, which is heading for the longest run of weekly declines since January.