Maruti Suzuki Reports Robust Q2 Results, Shares Open Flat

Maruti Suzuki Reports Robust Q2 Results, Shares Open Flat

Maruti Suzuki Reports Robust Q2 Results, Shares Open Flat

Maruti Suzuki India began the trading session with its shares opening flat following its robust Q2 results. The company reported a standalone net profit of ₹3,716.5 crore, representing an 80.28% YoY increase compared to ₹2,061.5 crore in the same quarter last year.

Technical analysts noted a positive trend for Maruti Suzuki shares. The 50-day EMA (Exponential Moving Average) has acted as a support on declines and is now positioned around ₹10,300.

Maruti Suzuki opened at an intraday high of ₹10,741.30 per share on BSE but experienced a pullback and traded around the previous week’s lows. The stock’s immediate support is seen around ₹10,250, with resistance around ₹10,600.

The company attributed its surging net profit to increased non-operating income, lower commodity prices, improved net sales, and cost-cutting measures. Its standalone revenue in Q2FY24 increased by 23.8% to ₹37,062.1 crore from ₹29,930.8 crore YoY. EBITDA rose by 72.8% to ₹4,784 crore from ₹2,768 crore, and EBITDA margin expanded by 360 basis points (bps) to 12.9% from 9.3% YoY.

Brokers have expressed a “buy” view on Maruti Suzuki stock in light of the company’s strong Q2 results. The company’s healthy margin beat and growth in EBITDA have garnered positive reviews.

• Motilal Oswal Financial Services: The company saw a high EBIT margin beat of nearly 400 bps on a QoQ basis. The margin increased to 10.8% (compared to an expected 9.1%), driven by lower raw material costs, favorable foreign exchange, a balanced mix, and operating leverage. The brokerage maintains a “buy” rating with a target price of ₹12,300.
• Nuvama Institutional Equities: Maruti Suzuki reported a robust Q2FY24 EBITDA increase of 73% YoY to ₹48 billion, exceeding predictions, largely due to better-than-expected gross margins. The brokerage recommends a “buy” with a target price of ₹12,500.
• JM Financial: The company’s EBITDA margin in 2QFY24 was 12.9% (+370bps QoQ), approximately 190bps higher than the brokerage’s projections. A variety of factors drove this increase, including softening commodity prices, cost-cutting measures, positive operating leverage, and a favorable mix. JM Financial predicts a “buy” rating with a target price of ₹11,750.

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Disclaimer: The opinions and suggestions provided in this article are those of individual analysts and do not reflect the viewpoints of VoM News. We encourage investors to consult with certified experts before making any investment choices.