Over the past 6 months, stocks of Maruti Suzuki delivered returns of 28% to investors. This makes Maruti Suzuki stocks the one with highest return in the global auto industry, where median returns stood at 10.43% as per data compiled by ETIG from Bloomberg.
Maruti Suzuki stocks are the world’s fourth expensive, taking into account next year’s projected earnings. Currently at 21.86 times of next year’s forecasted earnings, Maruti Suzuki features among the top 20 global auto companies where market capitalization is concerned.
On Friday, Maruti Suzuki stock stood at INR 4,789 per share on BSE with market capitalization at $21.65 billion. This amount exceeds that of Fiat Chrysler at $3.53 billion despite the fact that Maruti sales at just 6.3% that of Fiat sales. As on date, it is just Tesla Motors, BYD and Ferrari that have stocks trading higher than that of Maruti Suzuki where valuation is concerned.
There are various reasons for this high stock price among which are margin expansion, lower discounts and softer commodity pricing. These factors will also allow Maruti Suzuki to gain 35% profit growth during FY2014 to FY 2018 while a slew of new product launches and fuel options on current models are also contributing to increased Maruti Suzuki share prices. In a rare feat by an Indian company, market capitalization of Maruti Suzuki has even surpassed that of parent company Suzuki Motor Corporation.