Sharekhan is bullish on Maruti Suzuki India has recommended buy rating on the stock with a target price of Rs 7707 in its research report dated September 01, 2021.
Broker Research
September 02, 2021 / 01:42 PM IST
“India’s specialty chemicals industry is a decadal growth opportunity and it is still not too late to participate in the value creation process. We prefer CRAMS/CSM players Navin Fluorine (Navin) and PI Industries (PI) as they provide long-term earnings visibility. We also like UPL due to robust growth outlook and reducing debt concerns and SRF due to rising contribution from the chemicals business,” JM Financial research report.
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Sharekhan’s research report on Maruti Suzuki India
MSIL is likely to benefit from buoyant demand for passenger vehicles, driven by rising offtake in tier-2 and tier-3 cities and rural areas. MSIL is expected to defend its market share despite rising competition in the compact SUV segment, aided by strong product portfolio and position, brand appeal and ability to frequently launch new models. Earnings to clock a 37.8% CAGR during FY2021-FY2023E, driven by 19.9% revenue CAGR and a 340 bps rise in EBITDA margin. Stock trades at P/E of 25.5x and EV/EBITDA of 18.7x.
Outlook
We lower Maruti Suzuki’s (MSIL’s) earnings estimates and price target led by production cuts owing to a shortage of semiconductor chips. We retain a Buy rating with a revised price target of Rs 7,707.
For all recommendations report, click here
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