Nomura has maintained a Neutral rating on Maruti Suzuki with a target price of ₹12,455, indicating a potential upside of 13.2% from the current market price of ₹11,005.00.
Key insights from Nomura’s report:
- Demand Concerns: Weaker demand remains a concern, as reflected in a Q2 margin miss. Nomura notes that high discounts might continue in the near term.
- Positives: An improving CNG vehicle mix and rising average selling prices (ASPs) are highlighted as supportive factors for margins.
- Festive Season Sales: Maruti’s management projects a 14% year-over-year rise in festive season sales, indicating short-term optimism.
- FY25 Forecast: Maruti expects retail sales growth of 3-4% YoY for FY25.
- Inventory Levels: The company anticipates reducing inventory to 30 days by the end of the festive season, which may reduce discount pressure in Q3.
Nomura’s target price reflects a balanced view, factoring in both the positive festive season outlook and existing demand concerns.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors should perform due diligence before making investment decisions.
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