Maruti Suzuki Stock Gains on Bullish Stance from Global Brokerages

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Shares of Maruti Suzuki India gained 1.6 percent to Rs 10,460 per share in Friday’s intra-day to trade among top Sensex and Nifty 50 gainers in an otherwise weak market. The surge came after global brokerages Citi and Morgan Stanley maintained bullish stance on the counter.

Morgan Stanley remained ‘overweight’ on the counter, sharing a target price of Rs 11,963 apiece. Citi, on the other hand, shared a ‘buy’ call on the Maruti, raising target price to Rs 13,600 per share.

Both brokerages cited the company’s improving product mix, with a higher proportion of utility vehicles (UVs), as a key reason for their optimism. They also noted that Maruti Suzuki’s valuation appeared attractive, with a FY25 price-to-earnings (P/E) ratio of 23x, compared to the 10-year median 12-month forward P/E ratio of 25x.

In August 2023, Maruti Suzuki’s total domestic sales jumped 14 percent year-on-year (YoY) to 1.6 lakh units from 1.4 lakh units in the year-ago period. Sale of utility vehicles jumped 118 percent YoY in August 2023. Total export sales, too, increased 14.5 percent to 24,614 units in August 2023 from 21,481 in August 2022.

Overall, the bullish stance from global brokerages and the company’s strong sales performance in August 2023 are providing a boost to Maruti Suzuki stock.


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