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Motilal Oswal Report
Maruti Suzuki India Ltd.'s Q4 FY23 miss was led by a weak product mix and forex impact.
Q4 FY23 revenue/Ebitda/profit after tax grew 20%/38%/43% YoY to ~Rs 320.5 billion/ Rs 33.5 billion/Rs 26.2 billion. FY23 revenue/Ebitda/adjusted profit after tax grew 33%/93%/ 113% YoY.
Volumes grew 5% YoY (up 10% QoQ), while net realisation was flat QoQ (up 14% YoY) at Rs 622,400 (versus estimate Rs 644,100) due to a weak mix.
Gross margins declined by 60 bps QoQ (up 20 bps YoY) to 26.7% (versus our estimate 27.6%) due to an adverse mix and forex.
However, operating leverage drove Ebitda margin expansion of 70 bps QoQ (up 140 bps YoY) to 10.5% (versus our estimate 10.9%).
Ebitda grew 38% YoY to Rs 33.5 billion (versus our estimate Rs 36.1 billion). Adjusted profit after tax grew 43% YoY to Rs 26.2 billion (versus estimate Rs 28.4 billion).
The company has declared a dividend of Rs 90/share (versus Rs 60/share in FY22), representing a 33.4% dividend payout (versus 46.7% in FY22).
Driven by new products, Maruti Suzuki is expected to outperform underlying industry growth of 5-7% in FY24, resulting in market share gains and margin recovery. Chip shortages and commodity inflation could pose risks to our estimates.
We marginally lower our FY24E/FY25E earnings per share by 1%/3% to factor in high capex and resultant lower treasury income.
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