Rating- neutral; Maruti Suzuki expects to gain SUV market share in FY24
时间:2024-09-27 18:14:45 阅读(143)
Maruti suzuki’s financial performance for the fourth quarter of the fiscal year 2022-23. Average selling price (ASP) remained flat at approximately Rs 599k, which was slightly lower than the estimated Rs 605k. The company’s Ebitda missed estimates by 4%, due to higher raw material costs/sales at 76.2% (+40bp q-q) from sourcing from the Gujarat plant and Toyota, which have additional costs. However, this was partially offset by lower staff cost at 3.6% and other expenses at 13.3%. Ebitda margin was 10.5%, and Ebit margin was 8.1%. The discounts offered were at Rs 13.2k, down 90bp q-o-q.
In terms of demand, Nomura expects the industry to grow at 5-7% for the fiscal year 2023-24, driven by demand for SUVs. Maruti Suzuki plans to grow faster than the industry. The company’s order book stood at 412k, up from 363k at the end of December, and inventory is at 2-3 weeks. Margins for the Q4 were stable, but going ahead, steel prices may rise, while the fall in precious metals may benefit the company. There may be supply shortages in the first quarter of FY2023-24. Maruti Suzuki plans to invest Rs 80 bn in capital expenditure for FY2023-24. The company’s board has also approved a further capacity expansion of 1mn units after the new Kharkhoda plant ramps up to 1mn units.
Nomura estimates PV industry growth will slow to 6% in FY24F. Our Dipstick survey indicates further weakness in small cars in April-23. Hence, we trim FY24-25F volume growth estimates by 2%. While MSIL will gain share in SUVs in FY24F led by Fronx and Jimny, falling mix of car segment will drag overall market share. Hence, we now expect overall market share to be stable at 42% in FY24F . As there are no SUV launches likely in FY25F, market share may drop to 41% unless the car segment picks up. Key risks: (i) an accelerated shift to EVs may benefit Tata Motors and M&M; and (ii) supply constraints. We maintain FY24F/25F Ebitda margin estimates at 10.9%/ 10.7%. As industry inventory rises and growth slows, rise in A&P spends may offset operating leverage.
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- tions and academic institutions have computed logistics costs, which are widely quoted to stress the point that India is a country with high logistics costs.” In addition to the ones I mentioned earlier, NCAER cites three—Armstrong and Associates (2017), an estimate of 13% of GDP; CII (2015), an estimate of 10.9% of GVA; and NCAER (2019), an estimate of 8.9% of GVA. Clearly, there are variations in what is being measured and how. This new NCAER report uses supply and use tables. What does it find? In 2021-22, logistics costs had an estimated range of between 7.8% and 8.9%. In 2014-15, they had an estimated range of between 8.3% and 9.4%. There has been a decline over time (with a transient increase in 2017-18 and 2018-19). It cannot be anyone’s case that this new NCAER report is the last word on the subject. But it is a beginning, with a clear methodology. And two points emerge. First, logistics costs aren’t as bad as they are often made out to be. Second, they have declined over time (also evident from LPI).
Logistics, good or bad, are driven by the states and the commerce ministry has a LEADS (Logistics Ease Across Different States) report, based on perceptions. The 2023 version was released in December. Since states are heterogenous, in the reporting, they are divided into four groups—coastal, landlocked, north-east, and UTs. States that do well are called achievers. Nomenclature matters. Thus, states that are middling aren’t called average. They are called fast movers. States that are sub-par are called aspirers. Let me highlight coastal states, since 75% of export cargo is estimated to originate from them. Among coastal states, ones that do well are Andhra Pradesh, Gujarat, Karnataka, and Tamil Nadu. The ones that lag are Goa, Odisha, and West Bengal. While India’s logistics performance may have improved over time, that’s not true of every state. Some have slipped. Most states have a state-level logistics policy, including Goa and Odisha. West Bengal, bottom of the pecking order in the coastal category, doesn’t have one. To quote from LEADS 2023, “Looking ahead, the State (West Bengal) could benefit from formulating a State Logistics Master Plan and State Logistics Policy to drive efficiency improvements and facilitate investments within the logistics sector and undertake consultation with the logistics stakeholders for educating and informing them about the initiatives State is undertaking for the development and improvement of logistics sector.”
Logistics has been talked about for a long time and India has also focused on improving performance. We are now getting some precise data on measurement and quantification. That helps.
Bibek Debroy, chairman, EAC-PM. Views are personal.
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