Maruti Suzuki India (MSIL) net revenues increased +13% YoY/+25% QoQ to Rs 234 billion whereas export revenue increased 15% YoY to Rs 13 billion. Volumes for the quarter increased +13% YoY/+19% QoQ to 495k units; ASPs for the quarter increased +5% QoQ to Rs 448k. Discounts during the quarter increased +17% QoQ to Rs 20.2k.

Employee expenses increased 9% YoY/14% QoQ to Rs 9.45 billion due to salary increments and one off provision for retirement benefits of Rs 200 million. EBITDA for the quarter increased 6% YoY/ 15% QoQ to Rs 22.2 billion. EBITDA margin for the quarter declined 80bps QoQ to 9.5% due to adverse commodity prices and unfavourable product mix. Adj. PAT increased 24% YoY/ 42% QoQ to Rs 19.4 billion.

Commenting on the result review, IDBI Capital Markets & Securities said, "MSIL Q3FY21 results was below our and consensus estimates at EBITDA and Adj. PAT level due to higher RM cost and higher operating expenses. We believe pent demand and preference for personal mobility has helped MSIL to register good numbers during festive season."

"We build volume growth of 18%/15% for FY22E/FY23E respectively on account of lower base and higher premium car sales and expect after two years of consecutive decline company set for a multiyear upcycle," it added.

Brokerage firm further said it will also increase other income estimates for FY22E/FY23E factoring the higher yields. We expect revenue/earnings to grow at ~4%/6% CAGR over FY20-FY23E with EBITDA margin of ~9%. "We have arrived FY23E EPS at Rs 263, factoring the higher realization and volume growth. We maintain our rating to Accumulate and arrive at a TP of Rs 7,912 (earlier Rs 7,525) based on PER of 30x FY23E EPS."

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