"Maruti Suzuki is India’s largest PV manufacturer with ~40% market share. With the industry shifting towards dieselisation, Maruti's diesel engine capacity expansion plans look to be on the right track. Falling crude prices and a reversal in the interest rate cycle in H2FY13E will help improve the sales over FY13E/FY14E. We estimate ~36% CAGR (FY14E-12) increase in EBIDTA and a gradual increase in RoCE over~16% FY14E."
"In early 2012, the stock embarked upon a strong rally (Rs 900-1428), thereby reinforcing its presence within index performing stocks. After an impulsive run up, the stock has witnessed a decent correction over the past few months. Question is whether this is a reversal of the up trend or a buying opportunity. A look at the monthly time interval charts indicate continuation of an up trend and point towards the fact that the share price has approached the major long term support zone of Rs 1060-1040. Various historical monthly high or lows and the presence of long term trend line connecting 2008- 2011 lows make this range a solid support for Maruti’s share price."
"This stock has recently made a sharp rebound twice from Rs 1050-1060 respecting this long term support zone. High volumes during early June are an attestation of increasing participation in the stock near support levels. We expect a change of guard in the short-term downtrend, which is likely to see the stock price rally towards Rs 1200-1210 levels. The higher side targets for Maruti are projected using the Fibonacci retracement of the current decline (Rs 1428-1051). The 50% retracement is at Rs 1239 while the 50 day moving average for the stock is present at Rs 1211. Among oscillators, the monthly RSI (14) continues to trend in the positive zone despite the recent correction and supports bullish bias," says ICICIdirect.com research report.
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