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Jefferies raises Maruti to 'buy,' says co past the worst
6/29/2012 12:27 PM
Moneycontrol Bureau
Passenger car makers like Maruti Suzuki have been hit hard by a sharp slowdown in sales, especially of petrol powered vehicles. But there could be a smooth road ahead of the current potholes for Maruti Suzuki. Global securities and investment banking group Jefferies on Friday upgraded the India's largest passenger car maker to "buy" from "hold."
"Maruti is set to benefit from a combination of cyclical and secular trends from FY13. Competitive intensity is waning and likely to remain muted for a few years as most of the new competitors are struggling with their portfolio. Industry demand, which is currently weak, will likely recover sometime in the next one year, though Maruti benefits from a weak base in FY13 itself," Jefferies analysts Govindarajan Chellappa and Rajasa Kakulavarapu said.
A sharp rise in petrol prices over the last one year, with expensive loans, has led to a sharp slowdown in demand for petrol vehicles, like the entry level small cars
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