Hold Maruti Suzuki for target of Rs 1550 says Indiabulls Securities
February 10, 2010 by admin
Filed under Brokerage Recommendations
Indiabulls Securities Research in its research report dated February 10, 2010 has maintained its hold rating on the stock Maruti Suzuki, with a price target of Rs 1550.
The Research firm further said, we hold a positive outlook towards the auto sector in the near-to-medium term on the back of low penetration, increasing per capita income and easy availability of funds. Moreover, we expect Maruti Suzuki to take advantage of this opportunity through its strong market positioning, new launches and capacity expansion plans underway. However, we expect the increasing competition in the A2 segment may serve as a spoilsport. Our DCF valuation, assuming a 12.8% of WACC and a 5% of terminal growth rate, gives a target price (TP) of Rs 1,550, which provides for a limited upside potential of 11.8% from the CMP of Rs 1,386. Hence, we maintain our Hold rating on the stock.
Source: Moneycontrol.
