Maruti Suzuki India Receives 'Sell' Rating from MarketsMOJO, Poor Long-Term Growth and Decline in Profits

Maruti Suzuki India, a leading player in the Indian automobile industry, has recently received a 'Sell' rating from MarketsMOJO. This downgrade comes as a result of poor long-term growth, with the company's operating profit only growing at an annual rate of 0.28% over the last 5 years. Additionally, the company has declared negative results in September 2024 after 10 consecutive positive quarters, with a decrease in PAT(Q) at Rs 3,102.50 crore and a lowest DPR(Y) at 29.14%. The company's Debtors Turnover Ratio (HY) is also at its lowest at 23.38 times.
In the last 1 year, Maruti Suzuki India has underperformed the market, with a return of only 6.86% compared to the market's (BSE 500) returns of 27.99%. The technical trend for the stock is currently sideways, indicating no clear price momentum. Multiple factors such as MACD, Bollinger Band, and KST also suggest a sideways trend.

However, the company does have a low Debt to Equity ratio (avg) at 0 times and an attractive valuation with a 3.9 Price to Book Value and ROE of 15.7. The stock is currently trading at a discount compared to its average historical valuations. Despite generating a return of 6.86% in the last year, the company's profits have risen by 22.8%, resulting in a PEG ratio of 1.4.

It is worth noting that Maruti Suzuki India has a high institutional holding at 38.49%, indicating that these investors have better capability and resources to analyze the fundamentals of the company compared to most retail investors. Overall, with the recent downgrade to 'Sell' by MarketsMOJO and various factors indicating a sideways trend, investors may want to carefully consider their options before investing in Maruti Suzuki India.