Maruti scorches Street with new MPV, stock soars to a record high
Maruti Suzuki, which drove car ownership in India through its compact cars over the past four decades, surged past ₹3 lakh crore in market value on Wednesday after it unveiled its costliest vehicle to date, underscoring undiminished demand for premium transportation choices in an economy where the budget-end of the business appears to be stagnating. The stock rose more than 3% on Wednesday to hit a new all-time high. The shares crossed ₹10,000 apiece for the first time in a choppy trading session.
On Wednesday, Maruti announced the launch of Invicto, a seven-seater upscale people mover (or multi-purpose vehicle). The vehicle is priced in the vicinity of ₹25 lakh. On Wednesday, Maruti Suzuki topped ₹10,036.95 on the NSE before ending at ₹9,990.10, up 3.55% from the previous close.
Nearly a million shares exchanged hands on the BSE and NSE, more than twice its combined daily average volume for the last one month. Recent launches have helped the company gain market share, while margins have recovered to double-digits after ten quarters, fuelling investor appetite for the stock, analysts said. «The stock is playing a catch-up rally,» said Pankaj Pandey, head of research, ICICI Securities.
«The company is seeing recovery in margins supported by cooling off in commodity and raw material prices. New product launches are also seeing good traction.» ICICI Securities has a buy rating on the stock with a target price of ₹11,000 — implying another 10.11% upside from the current levels. The stock was the top gainer among the frontline stocks on Wednesday, helping the Nifty Auto index jump 1.64%.
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