Maruti Suzuki India Ltd. (MSI) shares gained for the second consecutive day on January 2, 2025, rising by 3% to Rs 11,545 per share as of 10:45 AM. The bullish momentum in the stock is attributed to robust December car sales and encouraging management commentary, signaling strong demand and future growth prospects.

December 2024 Sales Performance

Maruti Suzuki reported a 30% increase in total wholesales in December 2024, with sales of 1,78,248 units, compared to 1,37,551 units in December 2023.

Breakdown of sales performance:

1. Domestic Sales:

   • Total domestic sales, including light commercial vehicles (LCVs) and supplies to Toyota Kirloskar Motor, stood at 1,32,523 units, up 24.44% from 1,06,492 units in December 2023.
   • Domestic passenger vehicle (PV) sales were 1,30,117 units, marking a growth of 24.18% from 1,04,778 units in the same period last year.

2. Exports:

   • Maruti Suzuki's exports surged by 39.26%, reaching 37,419 units in December 2024, compared to 26,884 units in December 2023.

This significant growth across both domestic and export markets highlights the strong demand for Maruti Suzuki's product portfolio.

Management Commentary

Partho Banerjee, Senior Executive Officer - Marketing & Sales at Maruti Suzuki, shared insights into the company’s operations and strategy during an interview with CNBC-TV18:

• Pending Bookings: The company has over 2 lakh pending bookings, underscoring robust demand.
• Dealer Stock: Dealer inventory remains lean, with stock sufficient for just nine days, reflecting high retail sales velocity.
• Electric Vehicle (EV) Plans: Maruti Suzuki plans to unveil its complete EV ecosystem at the Bharat Mobility Global Expo, signaling its foray into sustainable mobility.
• Market Strategy: The company remains technology-agnostic to cater to diverse customer needs while maintaining market leadership.

Banerjee added, "All product segments fired on all cylinders in December, monthly household incomes are not increasing in-line with vehicle costs."

Industry Leadership

Maruti Suzuki has consistently maintained its leadership in the Indian passenger vehicle market, with a dominant market share. The company’s diverse product lineup and focus on affordability have enabled it to capture demand across various customer segments.

Key highlights:

• Expanding EV Plans: The company's announcement of a complete EV ecosystem reflects its readiness to compete in India’s growing EV market.
• Export Growth: The 39.26% increase in exports indicates Maruti Suzuki’s growing presence in international markets.

Financial and Market Performance

Maruti Suzuki’s strong sales performance has driven positive sentiment among investors, as reflected in the 3% stock gain on January 2. The company’s focus on managing inventory and addressing pending bookings demonstrates its operational efficiency.

In the broader market context:

• The stock’s rise follows a strong year-end sales performance in December 2024.
• Analysts view the lean dealer inventory and high booking numbers as indicators of sustained demand in upcoming months.

Future Outlook

Maruti Suzuki’s emphasis on a technology-agnostic approach and its plans to unveil an electric vehicle ecosystem position the company well for long-term growth. The Bharat Mobility Global Expo will serve as a platform for the company to showcase its innovative strategies in sustainable mobility.

While rising vehicle costs pose a challenge, Maruti Suzuki’s ability to align its product portfolio with consumer demand and its robust distribution network ensure continued market dominance.

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