Buy Maruti Suzuki; target of Rs 8428: Prabhudas Lilladher

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

live

• bselive
• nselive

Volume

Todays L/H

More

×

Prabhudas Lilladher's research report on Maruti Suzuki

For Q3FY21, MSIL reported lower than estimated EBITDA at Rs22.3bn (PLe Rs25.6bn) led by combined impact of 1) RM inflation (+330bp QoQ), 2) weak product mix and 3) unfavorable forex. However higher other income at Rs9.9b (PLe Rs6.8b) boosted adj.PAT at Rs19.4b (Rs18.5b). The recent price hike should partially dilute RM inflation in 4Q, however we expect gross margins to remain under pressure. Positive demand sentiments even post festive have lead to MSIL’s overall order backlog to remain healthy at ~1.5 months. We remain constructive on MSIL as we believe its not only the beneficiery of shift towards personal mobility but also structural shift towards petrol/CNG segments. We cut FY22/23 EPS by 3%/1% to factor in weaker mix.

Outlook

We factor in EBITDA/PAT CAGR of 15%/17% over FY20-23 and maintain Buy on the stock with revised price target of Rs8,428 (earlier Rs8,465) based on 27x Mar23 EPS (unchanged, v/s 30x 5yr LPA).

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Read More