Should you buy, sell or hold Maruti Suzuki shares post Q1 earnings?
Maruti Suzuki India (MSIL) set its foot on the gas pedal with a two-fold year-on-year jump in its net profit, the EBITDA miss acted as an unwanted speed breaker, inviting a 'Sell' recommendation from CLSA. The stock on Tuesday fell by 1.4% on NSE to the day's low of Rs 9,680.50 and was one of the worst performers in the Nifty pack in the opening trade. Notwithstanding the miss, domestic brokerages remain gung-ho about the prospects of the country's bellwether carmaker and expect a market share gain, going ahead.
They recommend a 'Buy' on the counter with an estimated 13-16% upside. Automaker Maruti Suzuki's net profit for the quarter ended June 2023 surged more than 2-fold YoY to Rs 2,485 crore, and was slightly higher than the ET Now poll estimate of Rs 2,444 crore. The revenue from operations rose 22% on year to Rs 32,327 crore and was higher than the estimated Rs 31,778 crore.
India’s largest automaker sold 498,030 units during the quarter, which was 6.4% higher than the year-ago period.Here's what brokerages recommend on the stock: CLSA: Sell | Target: Rs 8,796 CLSA said higher staff costs and other expenses led to lower-than-estimated EBITDA, which was a dampener in June quarter earnings. It recommended a 'Sell' on the stock. The brokerage sees a 10% downside in the counter with the current volume run-rate running lower than its estimated run-rate.
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