Is Maruti share a right buy or Not?

Maruti company decided to hike car price by Rs 34000

Management of the company has taken a bold step to hike the vehicle prices on the back of surging raw material cost. Steel that constitute 65% to 70% of company cost has surged from Rs 36000 per ton to Rs 58000 per ton and other raw materials like rubber is also on rising trend. 

This steep hike will result into 2.7% increase in realization that will be added to the revenue kitty for the stock. Analysts are expecting a fall of 7% to 8% volume this FY21 from earlier expectation of 20% fall.  

How corporate India is performing in third Quarter FY21?

To get an idea of how whole country is coming out of pandemic?  We have analyzed the corporate result of 238 companies that have come out with their q3 results. Revenue of these companies have increased by 10.4% year on year and net profit surged to 151% YOY.

This point out that economy is getting out of pandemic and showing a positive trend of growth. This will be great sign for companies like Maruti. So we are of the opinion that the stock is right buy at current price. 

How Maruti stock has performed in past two year?

The stock has hit a low of Rs 4000 in the month of march 2021 and since then moving up with current price at Rs 8048. All credit goes to opening of Indian economy and falling corona cases.

How to enter into Maruti share?

Keeping in view current volatility and Indian Budget ahead, one can add the stock in four installments of 25% each.Average to be done on each 5% fall. 

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