Maruti Suzuki India Ltd (NSE: MARUTI), formerly known as Maruti Udyog Ltd, is an automobile manufacturer in India. It is a subsidiary of the Japanese automotive manufacturer Suzuki Motor Corporation, which holds 56.21 per cent stake in it. As of July 2018, it had a market share of 53 per cent of the Indian passenger car market. The company is headquartered at New Delhi. Maruti Suzuki has 3,598 sales outlets across 1,861 cities in India. The company aims to increase its sales network to 4,000 outlets by 2020. It has 3,792 service stations across 1,861 cities throughout India. Maruti's dealership network is larger than that of enough known companies combined. Service is a major revenue generator of the company. Most of the service stations are managed on a franchise basis, where Maruti Suzuki trains the local staff. Also, The Express Service stations exist, sending across their repairman to the vehicle if it is away from a normal service centre.
On the technical front, MARUTI has higher highs and higher lows on the daily charts and is currently placed above the long-term EMAs in the daily frame. In the recent past, after clocking a low of Rs7,205 levels, the stock has witnessed a bounce and rallied to the current levels. At the current juncture, the stock has formed a base of around Rs7,650-7,700 levels on the lower side and is all set to move higher. The overall chart structure of the counter looks bullish from current levels and is witnessing a bounce from the support zone around Rs7,700 levels. This may trigger a fresh round of buying which may take the stock towards Rs8,750 plus levels. The stock is currently performing in line with the broader markets indicating the inherent strength in the counter and is trading well above the major long-term support levels. On the Bollinger band (20,2), the stock price is trading above the mean with the upper band facing in the northward direction indicating the price likely to move higher. Analyzing the recent volume price action, the volumes have been encouraging in the recent up move indicating strong hands have started accumulating the stock at current levels. On the oscillator’s side, RSI (14) is trading in a comfortable zone of above 60 levels indicating the intact bullishness in the stock. We expect the counter to continue its outperformance in the coming trading days as well and may move towards Rs9,000 levels in the medium-term. Any correction towards the recent support levels of Rs7,690 levels may be utilized to average the positions.
Srinivas Krishnan Bobba, Deputy Manager (technical research analysis) Karvy Stockbroking Ltd