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    Buy Maruti Suzuki India, target price Rs 7650: LKP Securities

    Synopsis

    Maruti Suzuki India Ltd. key Products/Revenue Segments include Passenger Cars & Light Duty Utility Vehicles, Mould & Dies, Other Operating Revenue, Service Income, Scrap, Rental Income for the year ending 31-Mar-2021.

    Maruti SuzukiReuters
    Promoters held 56.4 per cent stake in the company as of Dec 30, 2020, while FIIs held 23.1 per cent, DIIs 15.7 per cent and public and others 4.9 per cent.
    LKP Securities has buy call on Maruti Suzuki India with a target price of Rs 7650. The current market price of Maruti Suzuki India is Rs 6850.5.

    Time period given by analyst is one year when Maruti Suzuki India Ltd. price can reach defined target.

    Maruti Suzuki India Ltd., incorporated in the year 1981, is a Large Cap company (having a market cap of Rs 206350.89 Crore) operating in Auto sector.

    Maruti Suzuki India Ltd. key Products/Revenue Segments include Passenger Cars & Light Duty Utility Vehicles, Mould & Dies, Other Operating Revenue, Service Income, Scrap, Rental Income for the year ending 31-Mar-2021.

    Financials
    For the quarter ended 30-06-2021, the company reported a Consolidated Total Income of Rs 18284.30 Crore, down -24.21 % from last quarter Total Income of Rs 24124.20 Crore and up 236.79 % from last year same quarter Total Income of Rs 5429.00 Crore. Company reported net profit after tax of Rs 439.10 Crore in latest quarter.

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    Investment Rationale
    MSIL reported soft margin numbers in Q1, as the company witnessed an unprecedented hike in input costs and the demand was struck by Covid wave #2. However, the demand is now coming back driven by personal mobility theme, first time buyers and CNG variants. Going forward, with supply issues getting resolved sooner or later, we believe that newer launches, digitization of sales, expanding dealer network, higher capacity utilization rates and price hikes should trigger a superior volume and margin profile in the remainder of FY22 and ensuing year. Although the brokerage are seeing a shift in demand towards EVs, it believes it to be more in scooters and low end bikes rather than passenger cars while establishment of EV infrastructure along with capacity expansion should take some more time than expected. With ability to combat competition coming from EV shift and opening up of rural markets which were severely impacted by Covid Wave #2, MSIL is poised for a healthy growth here-on. Despite the short to mid-term issues, the brokerage remains sanguine on the stock with a price target of Rs 7,650.

    Promoter/FII Holdings
    Promoters held 56.4 per cent stake in the company as of Dec 30, 2020, while FIIs held 23.1 per cent, DIIs 15.7 per cent and public and others 4.9 per cent.



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    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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