Maruti Suzuki India downgraded to 'Hold' by MarketsMOJO, but shows potential for future growth.

Maruti Suzuki India, one of the leading players in the Indian automobile industry, has recently been downgraded to a 'Hold' by MarketsMOJO on October 24, 2024. This decision was based on various factors that indicate a neutral stance towards the stock.
One of the reasons for this downgrade is the company's low Debt to Equity ratio, which has been consistently at 0 times. This indicates a strong financial position and stability for the company. Additionally, Maruti Suzuki India has declared positive results for the last 10 consecutive quarters, with a significant growth in its Profit After Tax (HY) at Rs 7,712.00 crore, showing a growth of 47.44%. Its Profit Before Tax Less Other Income (Q) has also seen a growth of 69.94% at Rs 3,775.20 crore.

Technically, the stock is currently in a mildly bullish range, with multiple factors such as MACD, KST, and DOW indicating a bullish trend. However, the company's Return on Equity (ROE) stands at 15.8, which is considered fair, with a Price to Book Value of 4.3. The stock is currently trading at a discount compared to its average historical valuations, making it an attractive option for investors.

In the past year, Maruti Suzuki India has generated a return of 11.57%, which is lower than the market (BSE 500) returns of 34.29%. However, its profits have seen a significant increase of 50.8%, resulting in a PEG ratio of 0.6. This indicates that the stock is undervalued and has the potential for future growth.

It is worth noting that the company has a high institutional holding of 38.49%, which shows that these investors have better capabilities and resources to analyze the fundamentals of companies compared to retail investors.

On the other hand, Maruti Suzuki India has shown poor long-term growth, with its Operating Profit growing at an annual rate of 18.05% over the last 5 years. This is lower than the market's performance, indicating that the stock has underperformed in the last 1 year.

In conclusion, while Maruti Suzuki India has a strong financial position and has shown positive results in recent quarters, its stock has underperformed in the past year. With a fair valuation and potential for future growth, it is currently recommended to hold the stock and monitor its performance closely.