Motilal Oswal maintains buy on Maruti Suzuki, target price Rs 7,390

Motilal Oswal has maintained a Buy rating on Maruti Suzuki in the long term with a target price of Rs 7,390. Shares of Maruti Suzuki closed at Rs 7,017 apiece on Thursday, down 1.9% while the BSE Sensex fell 76.47 points to 40,575.17.

Company Financials

For the quarter ended 30-09-2019, the company has reported consolidated sales of Rs 16123.20 crore, down -13.96% from last quarter sales of Rs 18738.80 crore and down -25.20% from last year same quarter sales of Rs 21553.70 crore. The company has reported net profit after tax of Rs 1347.60 Crore in latest quarter.

Investment Rationale

The brokerage increased its consolidated earnings per share of Maurti for FY20 by 18% to factor in the possible increase in the sales volumes. While the near term demand headwinds persist, Maruti is best placed to weather these headwinds, particularly BS6 transition due to limited price inflation, the brokerage said.