BNP Paribas maintains ‘buy’ rating on Maruti Suzuki India

>> Saturday, November 22, 2008

Maruti Suzuki India 
CMP: Rs 511.35 

BNP Paribas has maintained a ‘buy’ rating on Maruti Suzuki India even while lowering the target price from the earlier Rs 840 to Rs 760. The foreign broking firm expects the company to regain market share with the launch of A-Star. “We believe the new A-Star will help Maruti regain most of its 230bp market share loss in the compact car segment,” says the report. 

The report also explains that the newly-launched A-Star has “focused on value, with feature-rich offerings and high fuel efficiency, rather than on performance.” The A-Star and the impending launch of the Splash in 1QFY10 will improve Maruti’s position in the A2 segment, where it has a 57% market share but had not launched any new products in the past two years, the report goes on to add.