HDFC titles
Maruti Suzuki (Buy)
Target: 6980 ₹
CMP: 6,260.45 ₹
While Maruti reported a loss of 250 million rupees in the first quarter of fiscal year 21, affected by Covid and production, the outlook is encouraging, with demand back to almost 85% of pre-Covid grades today.
While the company has increased its production to 4,000 games steadily with the day, the OEM still has a limited source due to limited activity at the Gujarat plant. Maruti is leveraging its entry-level portfolio as consumers for the use of non-public mobility in today’s environment.
The consistent percentage of first-time buyers higher through about five is consistent with cent (compared to forty-five consistent with penny in Q4-FY20). In addition, the OTF’s strategy of exiting the diesel segment is underway while gasoline and diesel costs have stabilized in Delhi/have fallen particularly in other regions.
Today, the OEM manufactures more than 4,000 sets steadily in its factories in Haryana and Gujarat (one team). As the Gujarat plant begins with the change of moment in mid-August 20, Maruti will produce another 900 sets according to the day.
We reiterate Maruti as our first selection in the sector. Key risk: increased competitive intensity.
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