Maruti Suzuki Q4 Review - Higher Raw Material Costs Hurt Margin; Order Backlog Strong: Motilal Oswal

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Motilal Oswal Report

Maruti Suzuki India Ltd.’s Q4 FY21 operating performance was impacted by higher commodity costs, partially offset by price hikes and lower discounts.

Near-term challenges (of Covid-19 and commodity) notwithstanding, there are drivers in place for sustained volume and margin recovery from H2 FY22E.

We lower our FY22E/FY23E earnings per share by 11%/3% to factor in some negative impact of the Covid-19 led lockdown on volumes as well as higher cost.

Revenue grew to approximately Rs 240.2 billion (up 32% YoY) in Q4 FY21, while Ebitda/profit after tax grew 29%/-10% to Rs 19.9 billion/Rs 11.7 billion.

Revenue/Ebitda/profit after tax fell 7%/27.6%/25% YoY in FY21.

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