Maruti Suzuki shares: JM Financial raises target price as trend seems shifting to hybrid vehicles amid EV deceleration
Also Read: Stocks to buy: Maruti Suzuki, M&M, TVS Motor among top picks in auto sector by HDFC Securities Similar trend is being witnessed in the domestic demand scenario for electric passenger vehicles (PV). Recently, Tata Motors has reduced its FY24 EV sales estimate by 20% to 75,000 - 80,000 units and also cut prices by upto ₹1.25 lakh per vehicle to drive wider adoption.
Meanwhile, Maruti Suzuki India is working on multiple technologies, such as Hybrids, EVs, Flex-fuel and Biogas in addition to ICE and CNG as the company believes multiple technologies can co-exist in the medium-to-long term. “The company had a foresight back then (when it launched CNG) and we believe its current tech-agnostic approach is again a well thought-out approach against committing resources to a single technology," JM Financial said.
Reports suggest that Maruti Suzuki is developing its own cost-effective ‘series’ hybrid solution for the small car segment and will continue to source Toyota’s Hybrid technology for larger SUVs and MPVs. It plans to launch five Hybrid models over the next 2-3 years.
Also Read: Wipro shares trading at expensive valuation, offer little margin of safety, says Kotak Equities; downgrades to ‘Sell’ As per JM Financial’s calculation, currently with 43% GST, the Total Cost of Ownership (TCO) of a mid-sized EV-SUV is 10% higher than Strong Hybrid Grand Vitara. It believes the rationalisation of GST rate can reduce TCO of a Strong Hybrid Grand Vitara by another 8% and that would bring it almost at par with compact EV-SUV.
“Tax rationalization on Hybrids could act as a fillip and shift consumer preference towards this choice of powertrain. Given the evolving global landscape and Maruti Suzuki’s tech-agnostic approach, we
. Read more on livemint.com
