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Buy Maruti Suzuki India; target of Rs 10,965: Sharekhan

Sharekhan is bullish on Maruti Suzuki India has recommended buy rating on the stock with a target price of Rs 10,965 in its research report dated November 25, 2022.

November 28, 2022 / 03:15 PM IST
 
 
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Sharekhan's research report on Maruti Suzuki India

Management bets on launches of SUVs and CNG variants to regain its market share. Company continues to strengthen its distribution network through increasing penetration. Easing constraints of electronic components, softening commodity prices and positive operating leverage likely to keep earnings growth momentum intact. Earnings are expected to post a 64.3% CAGR during FY2022-FY2024E, driven by a 21.2% revenue CAGR and a 470-bps improvement in EBITDA margin.

Outlook

We reiterate our Buy rating on Maruti Suzuki India Limited (MSIL), with an unchanged PT of Rs. 10,965, factoring gains in market shares through refreshed and new launches. The stock trades at P/E of 26.8x and EV/EBITDA of 19.6x on FY2024E earnings estimates.