The auto stocks have been under pressure for the second day running. Motilal Oswal, however, maintains a ‘Buy’ rating on key passenger vehicle maker Maruti Suzuki. The stock is down 20% in the past three months but the leading domestic brokerage house expects the stock to rally 29% from current levels. They have set a 12-month target price of Rs 17,406 per share.
Here is a detailed analysis of the investment rationale driving Motilal Oswal’s analysis-
#1. Maruti Suzuki: Retail demand healthy
Motilal Oswal one of the key concerns for Maruti Suzuki India has been the relatively weak wholesale numbers and a softer-than-expected performance in Q3FY26.
However, it says that the concerns around the automaker seem exaggerated given retail demand for Maruti Suzuki remains healthy across both passenger cars and utility vehicles.
The strong retail performance following the GST rate cut, where Maruti Suzuki outperformed peers in terms of sales to customers, is a key fact that the brokerage is banking upon.
#2. New capacity from April 2026 may boost wholesale volumes
Motilal Oswal highlighted that another reason of underperformance was the company’s near-term wholesale numbers have been capped by capacity constraints.
Analysts expect this issue to ease from April 2026 as new manufacturing capacity begins operations, which should help the automaker ramp up dispatches to dealers.
#3. New launches and exports to drive Maruti Suzuki’s growth in FY27
Looking ahead, Motilal Oswal expects Maruti Suzuki to outperform industry growth in FY27, supported by a strong pipeline of new product launches. These include a new variant of the Brezza, the recently launched Victoris and the upcoming e-Vitara, along with at least one more new model expected to be introduced in FY27.
Exports are also likely to remain a key growth driver for the company. Maruti Suzuki is working towards its medium-term target of exporting 750,000–800,000 vehicles annually by FY31. The company has already surpassed its FY26 export target in February 2026, reflecting strong overseas demand.
Analysts also expect the company to manage rising input cost pressures through lower discounts, a better product mix and normalisation in pricing for passenger cars.
Conclusion
Motilal Oswal expects healthy retail demand and a strong pipeline of new launches to help Maruti Suzuki’s share price movement. They believe robust export momentum to support growth going forward.
Disclaimer: This article provides factual analysis only and is not, and should not be construed as, an offer, solicitation, or recommendation to buy or sell securities. Investors must conduct their own independent due diligence and seek advice from a SEBI-registered financial advisor.