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Last Updated : Aug 03, 2020 04:15 PM IST | Source: Moneycontrol.com

Reduce Maruti Suzuki India; target of Rs 5300: ICICI Direct

ICICI Direct recommended reduce rating on Maruti Suzuki India with a target price of Rs 5300 in its research report dated July 28, 2020.

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ICICI Direct's research report on Maruti Suzuki India


Maruti Suzuki (MSIL) reported a weak operational performance in Q1FY21. Total operating income for Q1FY21 was at Rs 4,107 crore (down 79.2% YoY), tracking 80.1% drop in volumes to 76,599 units (domestic down 82.1%, exports down 66%) although ASPs surprised positively - up 7.6% QoQ to Rs 4.80 lakh/unit. MSIL posted loss at EBITDA level of Rs 863 crore on the back of spike in other expenses & 120 bps sequential gross margin deterioration. Consequent loss at PAT level was at Rs 249 crore, limited by higher other income on account of fair value gains on investments.


Outlook


Hence, we maintain REDUCE, valuing the stock at Rs 5,300 i.e. 26x P/E on FY22E EPS of Rs 203.4.


For all recommendations report, click here


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First Published on Aug 3, 2020 12:40 pm
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