Maruti Suzuki India Ltd. share price target

8 Adjusted EBTIDA margin was 15.8% (adjusted for 80bps RM impact, 15bps onetime employee bonus provision, and Rs 700mn oneoff maintenance expense) still much belowourestimateof16.4%,mainlyasaveragediscountsreachedalltimehighsofRs...

Maruti Suzukis (MSIL) 3QFY16 APAT at Rs 10.2bn ( 19% YoY, -17% QoQ) came in significantly below expectations. Reported EBITDA margin at 14.4% witnessed 190bps QoQ decline, but adjusted for one-offs and lumpy expenses this stood at 16% (vs. our estimate of 16.5%).

Maruti Suzuki India Ltd (MSIL)'s Q3FY16 numbers came in well below street expectations. The top-line grew by 20% yoy at Rs148 bn. Volumes in the quarter grew by 15.6% yoy and 6% qoq to 3.74 lakh units. Net realizations improved by...

Maruti Suzuki's (MSIL) Q2FY16 performance was below our as well as street's estimates. Company delivered disappointing performance with ~ 200 bps QoQ decline (up 154 bps YoY) in EBIDTA margin at 14.4%, as against our estimate of 16.6%. Its Revenue/EBIDTA/PAT grew 19.7%/34%/27% YoY but fell (8.2)%/4.4%/17% QoQ as against our estimate of Rs 149.4bn/24.8bn/13.6bn in Q3FY16.

Background: Maruti is a subsidiary of Suzuki Motor Corp (holds a 54% stake, expected to become 56% post merger of SPIL). Pays ~6% on sales as royalty to parent.Starting in 1983, Maruti is India's largest passenger car company, which primarily sells compact hatchbacks (75% of volumes), Utility vehicles and sedans. Its key models are Alto, Wagon R, Swift and Dzire. With its early-mover advantage in the Indian market, Maruti is a dominant player in the domestic passenger car market with a ~ 45% market share. Maruti has over 1200 sales outlets in 900 cities & towns and over 3000 service outlets covering over 1408 cities & towns. Rural...

For 2QFY2016, Competent Auto (Competent) reported a decent set of numbers. The top-line for the quarter grew by 12.2% yoy to Rs220cr, which is slightly lower than our estimate of Rs226cr. The revenue growth is in-line with growth reported by Maruti Suzuki in 2QFY2016, where its top-line grew by 13.1% yoy largely owing to 10% volume growth. The EBIDTA for the quarter came in at Rs6cr as against Rs5cr in the corresponding quarter a year ago. The EBIDTA margin for the quarter improved by 9bp yoy to 2.7% as against 2.6% in 2QFY2015. The interest expense for the quarter grew by 40% yoy to Rs1.6cr as against Rs1.2cr in 2QFY2015. Consequently, the net profit came in at Rs2.6cr, growing by 21.6% on a yoy basis. Proxy play on Marutis growth: The top-line performance of the company is closely linked to the performance of Maruti Suzuki (MSIL). We expect MSIL to post robust volume growth in the domestic market going ahead on back of new launches which will be replicated by Competent. Also, we expect the market share of the company to remain stable/improve, as entry of a new dealer seems to be commercially unviable with property prices having soared significantly...

Background: Maruti is a subsidiary of Suzuki Motor Corp (holds a 54% stake, expected to become 56% post merger of SPIL). Pays ~6% on sales as royalty to parent. Starting in 1983, Maruti is India's largest passenger car company, which primarily sells compact hatchbacks (75% of volumes), Utility vehicles and sedans. Its key models are Alto, Wagon R, Swift and Dzire. With its early-mover advantage in the Indian market, Maruti is a dominant player in the domestic passenger car market with a ~ 45% market share. Maruti has over 1200 sales outlets in 900 cities & towns and over 3000 service outlets covering over 1408 cities & towns. Rural sales from towns...

Maruti Suzuki (MSIL) delivered another solid quarter with strong operational performance. Gross margin surprised positively with 50bps QoQ expansion, despite discount/vehicle rising to Rs 19.5k (vs. Rs 16k in 1QFY16).

Maruti Suzuki's (MSIL) Q2FY16 performance was broadly in line with our estimates. Company delivered strong performance with second highest operating margins - EBIDTA margin at 16.3%, up 385 bps YoY and flat QoQ. Its Revenue/EBIDTA/PAT grew 13.1%/48.1%/42.1% YoY and 3.8%/3.7%/2.7% QoQ as against our estimate of Rs 139.1bn/22.6bn/12.5bn in Q2FY16. Company's performance was broadly benefitted by favorable currency lowering raw material cost coupled with better product mix.