Maruti is a good value buy below Rs 1,000: Raamdeo Agrawal

In a chat with ET Now, Raamdeo Agrawal, Motilal Oswal Financial Services, shares his views on Maruti.

ET Now: For a long-term investor like you, does the Maruti strike bring a good buying opportunity? You always wanted to buy Maruti closer to Rs 1,150.

Raamdeo Agrawal: No. In fact, this strike is not a good sign of the way they are managing their labour relations. This is happening almost every year now. You have to give discount for the management's inability.

I am not criticizing them but their inability to ensure a peaceful labour environment does reflect negatively on them.

ET Now: Six months ago I distinctly remember this conversation and you went on a road show and you marketed Maruti. Would you advise clients to sell Maruti?

Raamdeo Agrawal: You do not buy and sell just like that. We are talking about 15-20 million cars in a population of 1,200 million. So the size of the opportunity is huge, and they have a 40-50 percent at entry level. They are the kings and then they are present in global markets too. So while the opportunity size is massive, the competence is also beyond doubt.

Maruti’s problems are temporary because they can be sorted out -- a good HR manager, a change of CEO or something like that might do the trick.

Workers must understand it is in the long-term interest of the company as well as the workers' and shareholders' that the problem is sorted out.

ET Now: At what price will Maruti be a good value buy?

Raamdeo Agrawal: Anything below Rs 1,000, anything in three digits.