Maruti Suzuki India share price slipped nearly 1 percent in the early trade on August 24 after the Competition Commission of India (CCI) imposed a fine on the company for anti-competitive practices.
The CCI imposed a fine of Rs 200 crore on the company for anti-competitive practices related to how it forced dealers to discount cars.
"This is to inform you that the CCI has passed an order on 23rd August, 2021 for the alleged contravention of Section 3 of the Competition Act, 2002 against the company in relation to implementing discount control policy vis-a-vis its dealers and has imposed a penalty for an amount of Rs 200 crore, the company said in its press release.
Broking house Motilal Oswal in its report has maintained buy rating on the stock with a target price of Rs 8,200.
While the underlying demand is strong, the near-term outlook is uncertain, hit by semiconductor shortages as well as the residual impact of commodity cost inflation reflecting in 2QFY22, said Motilal Oswal.
After a gap of two years, we expect new product launches to resume, with a mix of complete product upgrades (five within 2-3 years) and new model launches (three within two years). This should drive volume, market share, and a margin recovery. Profitability is near the trough and margin improvement is expected from the lows of 1HFY22.
The broking house sees scope for further improvement in dividend payouts and a resultant re-rating.
At 09:17 hrs Maruti Suzuki India was quoting at Rs 6,769.10, down Rs 57.65, or 0.84 percent on the BSE.
The share touched a 52-week high of Rs 8,400 and a 52-week low of Rs 6,273.70 on 13 January, 2021 and 24 September, 2020, respectively.
Currently, it is trading 19.42 percent below its 52-week high and 7.9 percent above its 52-week low.