Given the growing input cost (especially that of steel), several other car makers in India have announced price hikes in recent times. Hyundai Motors, Honda, and M&M have hiked prices starting January 2018.
MSIL has a market share of more than 50% in passenger vehicle (PV) segment in India. Domestic sales of the company contributed 92.1% to the revenue, while exports contributed 7.9% in FY2017. The company’s focus on premium passenger vehicle segment via NEXA has improved product mix. MSIL is also in the process of setting up a Lithium battery plant in Gujarat for developing an ecosystem for electric mobility (as per the Government of India’s
initiative towards clean environment).
Strong product pipeline like Baleno, next-gen Swift, Vitara SUV and S-cross are expected to aid volume led revenue growth. Also, production in Gujarat facility is expected to ramp up to full capacity by the end of FY18E. Thus, we expect domestic volumes to grow at ~13% CAGR to ~1.9 million units over FY17-19E. Owing to this, we expect revenue growth at ~15% CAGR over FY17-19E. Moreover, with better utilization and increased volumes, we expect PAT growth of ~16% CAGR over FY17-19E.
In yesterday's trade, Maruti Suzuki India had ended at Rs9,384.15, down by Rs2.6 or 0.03% from its previous closing of Rs9,386.75 on the BSE. The scrip opened at Rs9,395 and touched a high and low of Rs9,455 and Rs9,322.55 respectively.
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