Motilal Oswal - MOSL: Morning India (29/July/21): 1. Maruti Suzuki (Weak performance in a tough quarter; Good demand recovery); 2. JSW Steel; 3. Nestle India; 4. SRF; 5. Dalmia Bharat; 6. United Breweries; 7. ABB; 8. Coforge

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Motilal Oswal

Team Research

EUR 120.00 For Business Accounts Only

MOSL: Morning India (29/July/21): 1. Maruti Suzuki (Weak performance in a tough quarter; Good demand recovery); 2. JSW Steel; 3. Nestle India; 4. SRF; 5. Dalmia Bharat; 6. United Breweries; 7. ABB; 8. Coforge

MOrning India (29/July/21): 1. Maruti Suzuki (Weak performance in a tough quarter; Good demand recovery); 2. JSW Steel; 3. Nestle India; 4. SRF; 5. Dalmia Bharat; 6. United Breweries; 7. ABB; 8. Coforge

Today’s top research idea

Maruti Suzuki: Weak performance in a tough quarter; Good demand recovery

MSIL's 1QFY22 performance was weak in a tough quarter marked with impact of lockdown on volumes and commodity cost inflation. While commodity inflation will persist in 2Q, there are drivers in place for sustained volume and margin recovery from 2HFY22E.
EBITDA margin declined by 370bp QoQ to 4.7% (v/s our estimate of 5.2%), impacted by cost inflation (net impact of 90bp QoQ), higher staff costs (+18%QoQ/+46%YoY) and operating deleverage impact.
There is recovery seen in both urban and rural. Inquiries are similar as 4QFY21 and bookings are at 80-85% of 4QFY21. Inquiries are at 120% of Jun-21 and retails similar to Jun-21. Wholesales and retails in Jul-21 should be higher than Jun-21.
We lower our FY22E/FY23E EPS by 13%/3% to factor in further cost inflation in 2Q, higher staff cost and lower other income. Maintain Buy.

29/07/2021 32 EN

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Motilal Oswal

Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.

Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.

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MOSL: Morning India (29/July/21): 1. Maruti Suzuki (Weak performance in a tough quarter; Good demand recovery); 2. JSW Steel; 3. Nestle India; 4. SRF; 5. Dalmia Bharat; 6. United Breweries; 7. ABB; 8. Coforge

MOSL : HOME FIRST FINANCE COMPANY: Earnings in-line with sustained improvement in asset quality

MOSL : SHOPPERS STOP: Ticking the right boxes

MOSL : ERIS LIFESCIENCES: Enhanced efforts toward product launch-related activities

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