It has been a known fact that cars carrying the Maruti Suzuki brand sells well in India. In times when the auto industry has been struggling to achieve good numbers, Maruti Suzuki has reported an all-time high share price of about Rs 2,799 on the Bombay Stock Exchange. Outperforming rating on the stock has increased to about Rs 3,500 apiece as against Rs. 3,020 noted earlier.
Credit Suisse said, “We raise FY16 earnings per share estimate by around 3 percent and introduce FY17 estimates, which are 15 percent higher than the street's.” As per them, Maruti Suzuki as an automotive brand has been a top pick in the Indian market. Morover, Maruti Suzuki is expected to grow by 5% market in the next three years, whereas the industry is set to witness 12% compounded annual growth rate (CAGR).
Credit Suisse further added, “While the focus on new launches has largely been on sedans and SUVs, the launch of the small diesel engine is equally, if not more, important. The 800cc engine to be used on the new LCV and existing compact hatches could add ~100,000 units in FY17.” The brokerage has split the Maruti's discount noted in four year into two slots. One links factores to a weak macro economy cars Alto and WagonR, whereas the other includes copetitive intensity like Swift Dzire, Swift hatchback and Ertiga MUV.
Source: MC
