Maruti shares fall 4% after Kotak retains ‘sell’ call

maruti

Share price of auto major Maruti Suzuki was down over 4 percent intraday on April 13 after research and broking firm Kotak Institutional Equities maintained its sell call on the stock and has slashed target to Rs 4,900 from Rs 5,800 per share, a CNBC-TV18 report said.

The research firm is of the view that valuations are expensive at this juncture suggesting the stock factors in 7 percent CAGR in volumes over FY2020-50E.

Maruti Suzuki’s risk-reward at current market price remains fair adding that the near term will remain weak for the passenger vehicle industry.

RC Bhargava, Chairman of Maruti Suzuki India has strongly recommended resumption of economic activity and voiced his opposition at any further extension of the lockdown period beyond April 14.

In an exhaustive interview with Moneycontrol, he outlined the measures the government should take to recover from this massive setback and said the onus of creating demand in post-COVID 19 era rests on both the government and industry.

The four-wheelers manufacturer Maruti Suzuki India has sold 83,792 units in the month of March 2020. The company had sold 1,58,076 units in March 2019. The sales during March 2020 are not comparable with sales in March 2019 due to the suspension of operations with effect from March 22nd 2020, in line with national policy, said the company in a release.

Total sales include 76,976 units in the domestic market, 2,104 units of domestic OEM sales and 4,712 units of exports.

Maruti Suzuki India has suspended production at its facilities in Haryana till further notice. The company’s research and development centre at Rohtak would also remain closed, it said. “As a next step, the government policy now requires closure of production and, accordingly, the company has taken a decision on production closure,” the company said.

Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.?

News source:- moneycontrol

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