Wednesday, 3 July 2013

Share News - Maruti Suzuki

This is a subsidiary company of Suzuki Motor Corporation of Japan. Initially the company was formed with Government of India as a major partner under the name Maruti Udyog Ltd. Later the parent company gained major share holder status share holding pattern changed. The company is actively involved in manufacture and sales of Motor vehicles and spares. Maruti Suzuki India Ltd or Maruti as it is widely known remains unchallenged as India's largest passenger car maker. It is enjoying a 50 per cent share of the domestic car market. The product range begins form an entry level car of Alto to more versatile products like Ritz,A-Star, Swift, Wagon R, Estilo, Dzire and Vitara. Besides manufacturing automobiles the company also sells spares parts for its products, pre owned car sales and car financing. The company is also involved in Insurance business largely catering to its own customers.

Production facility
In the year 1983 the company came out with Maruti 800, which truly became the people’s car. In the following year Maruti started their export business. During the course of 1993 and 94 Maruti launched two more models namely Maruti Zen and Maruti Esteem. Both these models were well received by the Indian car lovers. It was in the year 2006 the company launched Swift and the Wagon R models. The following year Swift diesel models were launched. All these cars were timely introduced in the market with specific market segment. While more and more car makers entered the Indian car market Maruti was able to withstand the competition and still retain its position as a leading car maker. To cater to the demand of the Indian market Maruti today has four manufacturing facilities located in India.

The company has an agreement with Adani group to use the Munda port in Gujarat. Through this port Maruti can export 200,000 units per year. It also has a joint venture with Magneti Marelli Powertrain SpA.  Another joint venture that was announced was with Futaba Industrial Co. facilitate the Financing business of the Maruti, an agreement was made with Shreeram City Union finance Ltd. 

According to available data from the company the reported profit after tax is 2392 Cr. The interest expenses has increased to 190 Cr. from that of 55 in the last year. Depreciation stands at 1861 Cr. The EPS is at 78.2.The company has 18,427.9 Cr, as Reserve and Surplus. The Face value of the shares of the company is Rs. 5/- at the time of writing this review the shares of Maruti were trading at Rs.1578

The Dividend history of Maruti has been satisfactory.  It has paid dividends in the past five years from 2009 -70%, 2010 – 120%, 2011 – 150%, 2012 – 150% and 2013 – 160%.  

Among the prominent Mutual funds that hold Maruti are Reliance Equity Fund (166.18Cr.), HDFC Equity Fund (137.96Cr), HDFC Top 200 Fund (105.39Cr.), UTI Opportunities Fund (105.34Cr.)

Investors looking to diversify their investment could consider Maruti adding to their portfolio. Maruti has a good track record and outstanding company in the auto sector.

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