CMP-5769
Maruti Suzuki India Ltd a 100% debt free, a 38 years old company is a part of Suzuki Motor Corporation a Japanese multinational corporation headquartered in Minami-ku, Hamamatsu.In 2016, Suzuki was the eleventh biggest automaker by production worldwide. Suzuki has over 45,000 employees and has 35 production facilities in 23 countries, and 133 distributors in 192 countries.
Maruti Suzuki India Ltd (formerly Maruti Udyog Ltd) is India’s largest passenger car company, accounting for over 50 per cent of the domestic car market. The compnay was established in February 1981 with production starting in 1983 with the Maruti 700, made entirely in India. The Japanese car major held 56.21% stake in Maruti Suzuki.
The company is engaged in the business of manufacturing, purchase and sale of motor vehicles and spare parts (automobiles). The other activities of the company include facilitation of pre-owned car sales, fleet management and car financing. The company has nine subsidiary companies, namely Maruti Insurance Business Agency Ltd, Maruti Insurance Distribution Services Ltd, Maruti Insurance Agency Solutions Ltd, Maruti Insurance Agency Network Ltd, Maruti Insurance Agency Services Ltd, Maruti Insurance Agency Logistics Ltd, True Value Solutions Ltd, Maruti Insurance Broker Ltd and J J Impex (Delhi) Pvt Ltd.
Although Maruti Suzuki India (MSIL) has delivered a disappointing operating performance in recent quater ,with declining sales and Low volume growth it is expected that Maruti Suzuki India’s volume will clock ~8% CAGR over FY19-FY21E. Considering huge distribution network of the cars along with its low cost annual service of cars Maruti Suzuki is a household name in the India automobile industry. It is also said that majority of the first time car buyes prefer Maruti as their first car. Also recently Maruti Suzuki India has foreyed into premium automobile segment with the exclusive showroom and sepereate cars through its Nexa Brand.
Financials-:
On the financial front the company has delievered a solid Sales growth of 13% and 16% over 5 and 3 years period. Apart from that the Compounded net profit Growth rate of the company stands at 25 % over the 3 and 5 year period. Comapny has huge amount of investements in various other companies , Subsidies and capital markets which is around 36,000cr or approx 1200Rs per share which creates immense value for the company & shareholders over long term.
