Maruti Suzuki Q4 Results Review — Lumpy Costs Hurt Performance, Says Motilal Oswal, Maintaining 'Buy'

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Motilal Oswal Report

For FY26, while domestic demand is likely to remain weak, Maruti Suzuki India Ltd. is expected to outperform peers supported by its new launches. Further, continued export momentum is likely to boost volumes. Maruti Suzuki anticipates exports to rise at least by 20% in FY26. Hence, we factor in a 7.6% volume CAGR over FY25-27E.

However, we also factor in a 50bp margin pressure for Maruti Suzuki for FY26E given the anticipated rise in input costs. Overall, we expect the company to deliver a 10% earnings CAGR over FY25-27, driven by new launches and strong export growth.

At 24.3 times FY26E/21.8 times FY27E EPS, its valuations appear attractive. Reiterate Buy with a target price of Rs 13,985, valued at 26x FY27E earnings per share.

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