FINANCIAL PERFORMANCE :
On a Y-O-Y basis, Maruti Suzuki India Limited has performed Excellently. From the following table, we can see that SALES have registered a significant increase from Rs.20663.84 Cr to Rs.29591.52 Cr on a Y-o-Y basis.
However, RAW MATERIAL COST has also increased significantly from Rs.15403.33 Cr to Rs.21988.32 Cr during the period.
The NET PROFIT on an annual Basis has increased from Rs.1227.45 Cr to Rs.2624.74 Cr, registering a more than 100 percent increase.
The EPS has very handsomely risen to Rs.90.85 per share of FV of Rs.5. The last year EPS was Rs.42.89,which means a more than 100 percent increase in EPS.
RESERVES have gone up from Rs.9420.81 Cr to 12038.10 Cr.
DIVIDEND proposed is 120 percent against 70 percent last year.
The FY10 results are thus EXCELLENT by any standard. But, market price of the share has fallen to Rs.1331 after declaration of the result, presumably on the assumption that the result did not meet the EARLIER expectations of the market.
Some analysts seem to be expecting a Profit increase of around 200 percent, based on the stupendous sales registered in March'2010 and earlier. This did not come true. But, this expectation appears to be unreasonable, if we take into account the increase in raw material costs like steel.
4TH QUARTER :
The 4th Quarter sales income was Rs.8280.82 Cr against the 3rd quarter sales of Rs.7372.65 Cr. But, raw material cost was Rs.6127.64 cr against Rs.5491.86 cr in the previous quarter. Hence, total expenditure in 4th Quarter was up at Rs.7536.52 cr against rs.6571.72 Cr in previous Quarter. Thus, Net profit was marginally down from Rs.687.53 Cr to Rs.656.55 Cr. On the equity of Rs.144.46 cr, the quarterly EPS comes to Rs.22.73 - against Rs.23.80 in previous quarter.
Despite the increase in RAW MATERIAL COSTS, Maruti has still managed a handsome EPS of 90.95 for the full year (against a EPS of Rs.42.89 for previous year) and a quarterly EPS of Rs.22.80 for the 4th Quarter against Rs. 23.80 for the 3rd Quarter and a mere Rs.8.42 for the 4th Quarter of last year.
OPERATIONAL PERFORMANCE :
Maruti Suzuki sold a total of 10,18,365 vehicles in 2009-10. This is the first time in Indian automobile history that a car company has sold over a million units in a financial year. This included 8,70,790 units sold in the domestic market, the highest ever by the company in a fiscal. The export sales of 1,47,575 units in the year were the highest ever annual exports by the company.
The total sales numbers in 2009-10 mark a growth of 29 per cent over last financial year. Maruti Suzuki's total sale in 2008-09 was 792,167 units.
The total sales numbers in 2009-10 mark a growth of 29 per cent over last financial year. Maruti Suzuki's total sale in 2008-09 was 792,167 units.
The export numbers in the year were led by A-star. This fuel efficient compact car clocked over 1.27 lakh export sales in the fiscal. A-star was exported across Europe including United Kingdom, France, Germany, Italy, Netherlands etc. The major non-European export markets are Algeria, Chile, Indonesia and neighbouring countries. South Africa, Hong Kong, Australia and Norway were new markets where Maruti Suzuki cars were exported during the year.
On March 23, 2010, Maruti Suzuki rolled out the one millionth car of the year 2009-10. This feat takes the company into a very select group of global automakers with such volumes.
Maruti Suzuki is now expanding its production capacity to reach 12,50,000 units (1.25 million) by 2012. In March 2010, the company announced an investment of Rs 1,700 Crore for expansion of the production facilities by 2.5 lakh units at its Manesar plant.
Maruti Suzuki is now expanding its production capacity to reach 12,50,000 units (1.25 million) by 2012. In March 2010, the company announced an investment of Rs 1,700 Crore for expansion of the production facilities by 2.5 lakh units at its Manesar plant.
MARKET PRICE PERFORMANCE :
The market price closed on 26.04.2010 at Rs.1331, which, on the EPS of 90.85 gives a P/E ratio of just 14.65, which is NOT A REASONABLE VALUATION for a STAR PERFORMER like Maruti.
At a P/E of 18, the Market price comes to Rs.1635. For the present, Sentiment (of not meeting High market expectations) has driven down Maruti price.I presume, soon, Maruti price will find its justified valuations. If we consider next year performance, the forward numbers will be better than FY10 numbers, as the company is coming out with exceptional Domestic and Export sales Performance, month after month.
Hence, Maruti is a BUY at current prices.
Note : Readers are welcome to offer their comments,suggestions, additions or corrections - and the same will be accepted gratefully. The figures below are AUDITED-CUMULATIVE-CONSOLIDATED figures.
| I T E M | FY2010 | FY2009 (In lakhs Rupees) |
| Net Sales | 2959152 | 2066384 |
| Other Oprting Income | 53099 | 50836 |
| Stock in trade and WIP | -19408 | 28101 |
| Raw Materials | 2198832 | 1540333 |
| Purchase of traded goods | 91242 | 73231 |
| Employees Cost | 56053 | 48128 |
| Depreciation | 84138 | 71649 |
| Other Expdr | 281205 | 240681 |
| Total Expdr | 2692062 | 2002123 |
| Profit B- OI,INT | 320189 | 115097 |
| Other Income | 58206 | 60464 |
| Profit B INT | 378395 | 175561 |
| Interest | 3742 | 5450 |
| PBT | 374653 | 170111 |
| Tax Expense | 112189 | 47366 |
| PAT | 262464 | 122745 |
| Dividend (%) | 120 | 70 |
| Face Value (in Rs.) | 5 | 5 |
| Paid-up Equity | 14446 | 14446 |
| Reserves | 1203810 | 942081 |
| Basic EPS | 90.85 | 42.49 |
| Diluted EPS | 90.85 | 42.49 |
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