Maruti Suzuki shares get an upgrade with a 15% price target hike by Emkay on better risk-reward

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Brokerage firm Emkay Global has upgraded shares of Maruti Suzuki India Ltd., India’s largest passenger car manufacturer, to a ‘Buy’ rating from its earlier rating of ‘Add’, despite a muted near-term outlook for the passenger vehicle industry.

The brokerage has also increased its price target on Maruti Suzuki by 5.5% to ₹13,500. The revised price target implies a potential upside of 15% from Thursday’s closing levels.

New vehicle launches have historically driven passenger vehicle sales. Maruti Suzuki’s launch cycle is set to improve in FY26E, unlike the industry’s subdued pipeline.

It plans to introduce two major ICE SUVs — a 5-seater (likely in Sep-25E) and a 7-seater (likely in Jan-26E) — with an estimated combined production of 18,000–20,000 units per month (industry estimate), while Emkay factors in 12,000 units per month. Additionally, the recently unveiled E-Vitara electric SUV adds to the lineup.

This coincides with early signs of an improvement seen in small cars, which grew 2% in Dec-Jan after three years of decline. Potential demand drivers include recent tax cuts and the 8th Pay Commission. However, sustenance of such improvement needs to be watched, Emkay said.

Emkay said that Maruti Suzuki offers a favourable ‘risk-reward’, with one-year forward valuations near one standard deviation below the long-term average.

Maruti Suzuki on March 17 announced that it will be increasing the prices of its vehicles by up to 4%, effective April 1, 2025. The decision comes in response to the escalating input costs and rising operational expenses, impacting the company’s profitability.

This was the third instance of India’s largest passenger car manufacturer announcing a hike in the price of its vehicles after January and February this year.

Out of the 46 analysts that have coverage on Maruti Suzuki India Ltd, 38 of them have a ‘Buy’ recommendation on the stock, while five others have a ‘Hold’ rating and three say ‘Sell’.

Shares of Maruti Suzuki India Ltd. are currently trading 1.42% lower at ₹11,555. The stock is up 3% so far this year.

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