Maruti Suzuki’s big milestone: 2 crore cars in just 35 years; buy shares and gain up to 21%

Maruti Suzuki‘s big milestone: India’s largest automaker by market capitalisation Maruti Suzuki has achieved yet another feat with manufacturing 2 crore cars in less than 35 years. The stock of Maruti Suzuki is the costliest scrips among all the listed companies (excluding auto ancillary companies) on Indian bourses — NSE and BSE. Over the course of last two years, Maruti Suzuki shares have more than doubled the investors’ money vastly outperforming the benchmark Nifty Auto index and the headline indices Sensex and Nifty.

Shares of Maruti Suzuki (India) have returned 107% to Rs 8,746 from a share price level of Rs 4,217.95 on the last 24-month period on NSE. A number of brokerage firms have been bullish on the shares of Maruti Suzuki as the auto giant is making one after other milestones in terms of sales and financial performance. Maruti Suzuki has also been very consistent in distributing dividends. As per the records available with Bombay Stock Exchange, Maruti Suzuki has been perpetually distributing dividends for the last 14 years with the latest dividend of Rs 80 per equity share which was announced along with the earnings release for the quarter and the financial year ended 31 March 2018.

The domestic research and brokerage firm Motilal Oswal Securities has given a ‘buy’ after the company released vehicle sales number for the month of May 2018. Motilal Oswal has given a target price of Rs 10,468 which implies an upside of 20% from the current market price. The stock trades at 25.1x/19.8x FY19E/20E earnings, Motilal Oswal said in a report.

On the other hand, Angel Broking has given a ‘buy’ with a target price of Rs 10,619 which implies an upside of 21% from the current levels. GST regime and the Gujarat plant are expected to improve the company’s sales volume and margins, respectively, Angel Broking said in a research report.

Maruti Suzuki (India) is among the top 10 companies in India by market capitalisation and features way ahead of the industry peers such as Mahindra and Mahindra, Hero MotoCorp, Bajaj Auto, Tata Motors. As per Monday’s closing price of Rs 8,750.35, Maruti Suzuki (India) commands a market capitalisation of Rs 2,64,330.63 crore on BSE.

Maruti Suzuki India Limited