Maruti Suzuki India Limited (MSIL) shares hit record high on Tuesday after country’s largest auto maker logged best ever car sales in April. The company posted the best ever domestic sales at 1,44,492 units compared to 1,17,045 units in the same month 2016, registering a rise of 23.4 per cent. According to Financial Express newspaper, the company had recorded its previous best monthly domestic sales in September 2016 of 137,277 units.
Reacting to the domestic sales figure, shares of Maruti Suzuki were trading 2.98 per cent up at Rs 6720 at 1.28 pm. The share price opened at Rs 6674 and touched a high and low of Rs 6724 and Rs 6624, respectively in trade so far. Sensex was trading 45.41 points up at 29,963.81 during the same time.
The company’s total sales stood at 1,51,215 units in April, against 1,26,569 units in the same month last year, registering a 19.5 per cent jump.
While releasing the sales figure, the auto maker said that sales of mini segment cars that includes Alto and WagonR, rose 21.9 per cent to 38,897 units from 31,906 units a year ago. The compact segment registered a growth of 39.1 per cent to 6,35,84 units in April this year as against 45,700 units in the same month of 2016. While sales of mid-sized sedan Ciaz grew 23.2 per cent to 7,024 units during the month.
In the utility vehicles segment, including Ertiga, S-Cross and Vitara Brezza, the sales rose 28.6 per cent to 20,638 units in April from 16,044 units in the corresponding month last year.
Brokerages are bullish on the stocks of Maruti Suzuki. After the company announced its fourth quarter results, HDFC Securities said that it believes in the automaker’s growth story. It has maintained a ‘Buy’ rating on MSIL shares with a target of Rs 7,070. It had said in a research report, “With 20% EPS CAGR over FY17-19E and structural improvement in RoE (at close to 25% by FY19E v/s 10 year average of about 17%), we maintain a BUY on MSIL with a target price of Rs 7,070, based on 20 times multiple of FY19E EPS,” HDFC Securities said in a research report.
Another brokerage house Edelweiss Research has also maintained a ‘Buy’ rating on the stock with target price of Rs 6,928. It believes MSIL would remain well placed to gain market share given robust new launch pipeline, expanding distribution and consumer preference shifting to petrol variants.