Prices hiked by 0.4%, but much more needed: A ~300bp increase in costs may lead to sharp margin pressure in 1QFY27F

研报英文原文证据摘录

Prices hiked by 0.4%, but much more needed: A ~300bp increase in costs may lead to sharp margin pressure in 1QFY27F

Global Markets Research

Maruti Suzuki MRTI.NS MSIL IN 15 June 2026

EQUITY: AUTOS & AUTO PARTS

RatingPrices hiked by 0.4%, but much more needed Remains Neutral

Target priceA ~300bp increase in costs may lead to sharp margin Remains INR 13,435

pressure in 1QFY27F

Closing price

15 June 2026 INR 13,805Maruti Suzuki effected a weighted average price hike of 0.4% (as per our calculations)

on 14 June 2026. The company will provide price protection for bookings done upto 14 June

2026 on Alto, Spresso, Celerio and Wagon R. We expected a price hike of ~100bp+ but Implied upside -2.7%

believe the company opted for a lesser increase to support volume growth.

Market Cap (USD mn) 45,824.0

We estimate PV OEMs face commodity cost pressures of ~300bp in 1QFY27F (Fig.4). In ADT (USD mn) 78.0

addition, we believe higher costs for gas, freight rates, labour costs (increase in minimum

wages for vendors) and costs from new plants may put pressure on margins. Thus, OEMs

need further price hikes to pass on these costs, in our view. MSIL’s management believes that Relative performance chart

once the West Asia conflict is over, cost pressures should ease.

We believe further price hikes may impact demand, particularly for the entry segment where

the customer is more price-sensitive. A key risk to watch will be the movement in discounts

which have been low given less inventory. As network stock builds up, discounts can also

move up. For MSIL, we estimate inventory increased from 12 days at the end of Mar-26

to ~24 days at the end of May-26. As per FADA, the PV industry’s inventory rose to 31-33

days at the end of May.