Maruti Suzuki India's shares gained in the early trade on January 29 after the company reported a 5.1 percent year-on-year increase in third quarter (October-December) profit at Rs 1,564.8 crore versus Rs 1,489.3 crore in the same period last year.
Revenue from operations grew 5.3 percent year-on-year to Rs 20,707 crore in the quarter with total vehicles sales growth at 2 percent.
Also Read - Maruti Suzuki Q3 misses estimates, profit rises 5.1%; higher promotion expenses hit margin
Kotak Institutional Equities | Rating: Sell | Target: Rs 5,800 per share
The EBITDA is percent below our estimates mainly due to a weaker product mix, said Kotak Institutional Equities.
It expects PV industry volumes to pick up in FY21 led by rural demand recovery and cut FY21-22 EPS estimates by 7-8% led by 2-4% cut in our volume assumptions.
The competitive intensity in compact SUVs & rich valuations drive our sell rating and total volumes to grow by 6% in FY21, it added.
Morgan Stanley | Rating: Overweight | Target: Rs 8,205 per share
Some return of operating leverage helped margins to rise QoQ and have enough levers to increase earnings as demand turns, said Morgan Stanley.
The key thing to watch in near-term is BS-VI transition and it believes that the multiples are sustainable at current levels.
Jefferies | Rating: Hold | Target: Raised to Rs 7,500 from Rs 7,000 per share
The Q3 revenue was 4 percent below our estimate due to very high discounts. The revenue miss flowed into bottomline as well, said Jefferies.
Research house raise volume estimates particularly for FY20 to reflect better H2 trends. The FY20-22 EPS estimates increase to Rs 206/261/336 from Rs 158/231/324.
It see limited upside even assuming double-digit volume growth over FY21-22.
At 09:20 hrs Maruti Suzuki India was quoting at Rs 7,046.30, up Rs 49.35, or 0.71 percent on the BSE.
Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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