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Maruti 0410

Maruti 12700 CE Recommended above 408, Sl 375, Trgt 444-486.

Maruti Suzuki India has recorded a total sales increase of 1.87% to 1,84,727 units in September 2024 as against 1,81,343 units sold in September 2023.

The sales of domestic passenger vehicles stood at 1,44,962 units (down 3.88% YoY) while sales of light commercial vehicles came in at 3,099 units (up 35.09% YoY) during the period under review.

While the company’s total domestic sales (PV+LCV+OEM) declined 1.15% YoY to 1,56,999 units in September 2024 as against 1,58,832 units recorded in September 2023. The total sales exports increased by 23.18% YoY to 27,728 units sold in September 2024.

The Indian Auto Industry comes in the top 5 largest auto industries in the world. India is also a prominent auto exporter and has strong export growth expectations for the near future. The support from the government is providing the auto companies with a boost needed in their development.

We can look into more details and dig a little deeper into the analysis of the stock of this sector.

The mainstream of revenue for the Auto Sector is their sales, Maruti Suzuki has reported decent sales growth of 19.92 % and in the latest quarter, sales were Rs 35,531.40 Cr. To judge whether the company’s inventory is being sold or not and whether the sales picture is true, the inventory turnover ratio plays a major role, which is 34.80 times for Maruti Suzuki. It is managing its inventory efficiently

Analysis

  • Maruti Suzuki reported Profit growth of 64.11 % over the year, where the latest year’s profit is Rs 13,209.40 Cr compared to the previous year’s Rs 8,049.20 Cr. The new permits by governments and increasing demand will lead to an increase in profits in the coming year.
     
  • The operating profit of Maruti Suzuki in the latest quarter is Rs 4,502.30 Cr. It helps in measuring the company’s operating performance which is used to make financing decisions.
     
  • Maruti Suzuki has an average ROE of 18.30 %. The ROE is an important financial parameter because Auto companies work with high equity investments. Also, they have to take huge debt to incur the research and manufacturing work so their Debt to Equity ratio should be evaluated. Maruti Suzuki has a low Debt to Equity ratio of 0.00.
     
  • Maruti Suzuki pays a dividend of 125 Rs per share. It tells us that a company likes to share profits with its shareholders. The dividend yield is low at 1.01 %.
     
  • The share of promoters in Maruti Suzuki is high at 58.19 %, where the pledging is 0 %.
     
  • What the market is willing to pay for the company for its earnings can be determined by PE multiple. The current PE of Maruti Suzuki is 27.03 compared to the 5-year average PE of 38.73.

The stock opened flat and had broken yesterday’s low with low volumes. It was a sign that the bears were struggling to hold the bear’s grip. As the stock made a big green candle on the 5-minute chart, it was recommended ATM Call Option catch further momentum.

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