Impact on maruti suzuki shareholders on hike in car prices

 Maruti Suzuki is the largest selling car company in India. People's trust is very high on Maruti & Suzuki cars, because according to automobile experts, maintenance of cars of Maruti Company is a lot of work and people of middle class, lower middle class, upper middle class and higher classes if we talk about the princess of cars. You can buy Maruti Suzuki cars.

Impact on Maruti Suzuki shareholders on hike in car price:

Let us tell all of you that Maruti is going to increase the prices of all its car models. Maruti Suzuki is going to increase the prices of cars from September 2021. The management of Maruti Suzuki has given this information to the market regulators. Maruti Suzuki had hiked the prices of its own car model Swift. New customers have been paying 15,000 rs for Swift car since last year has jumped in 2020. Also Maruti had increased the prices of all CNG car models.

Maruti Suzuki Company has been increasing the prices of all its cars for the last few months, from January to April; the company has already increased the prices of all the cars. Earlier the company had said that the prices of the cars have been increased due to increase in input cost. Now this time the company management is citing the price increase of raw material. The thing is that every automobile company wants to increase the prices of their car models, for this the reasons can be different. But seen that if the prices of raw materials will increase, then the cost of the car manufacturing companies will increase and for this the customer will have to get the area money if he wants to buy a new car. Maruti Suzuki has increased the price of some car models by up to 34,000. The price of each car model is different.

In the month of June, the management of the Maruti Company had given indications on the media channels about increasing the prices of the cars. If we look at the car portfolio of Maruti Suzuki Company, then the company has cars from Maruti Alto to S-Cross, sedan levels. Starting price of these cars range from Rs 2.99 lakhs to above Rs.12 lakhs. The prices of the cars are witnessing volatility due to the increase in the prices of raw materials. If seen, the company has increased the prices of the car by more than 1% in the same year.

                           

According to Shashank Srivastava, Senior Officer, Maruti Suzuki, unexpected enhancement has been seen in the prices of commodity products. If we talk about the prices of steel, it has almost doubled as compared to the previous years. Where the price of steel used to be 37000 and 38000 per ton, today the price of steel has become more than 65000 per ton. If we talk about the international market press of copper, then the price has been more than double. Earlier, copper was being sold at 5200 per tonne in the international markets but today the price of copper has increased to more than 10,000. Radium prices are touching the sky. Radium is an expensive metal that is used. Earlier today the price of radium was 18,000 ras per gram, but now the price of radium metal has exceeded 64,000 per gram. Such a huge jump in commodity prices is surprising even the companies. By doing this, the increase in the prices of the cars can also be justified.

 Maruti Suzuki Company cars price hike impact on company shareholders:

If seen, the prices of the goods sold by any company in its market are considered good in the stock market, stock traders and investors think that the company's profit will also increase by increasing the prices of the products. But many times it can be wrong to think so. It is very important to know the reasons behind increasing the prices of the company's products. The prices of Maruti Suzuki Company’s cars are increasing, but the effect of this can also be seen on the company's sales. Due to covid 19, the sale of vehicles is not being done in the already automobile sector. Talking about Maruti Suzuki, the company's sales in the June 2021 quarter have been recorded at 17,776, while the sales figure was more than 24,000 in the March quarter. The same Maruti Suzuki's profit has been recorded at 439cr while in March 2021 counter, the net profit was recorded at more than 1150cr. In this way, there has been a huge decline in the profit and sales of the company. This will not be considered a good sign for the economy. Why India's automobile sector plays a very important role in India's GDP.

The share price of Maruti's stock has been seeing a decline for a few days. The share price of Maruti is hovering around 6740rs as of today's trading. The share price has been fluctuating. If seen, Maruti's stock has also given multibagger returns to its shareholders in the last few years. Maruti Suzuki is a top brand in the auto car segment. Management is very strong. The demand for the product can be expected to be good in the coming years. There are many companies in which the shareholders get multibagger returns; one of them is Maruti Company. Maruti's company is still in profit if we look on year-on-year basis.

In nutshell, we can say that in short run due to increase commodity prices at domestic as well international levels, company can see pressure on margins and sales can also be under pressure. Company's management is not expecting much sale even in festival sessions due covid 19 impact on whole automobile sector and mind is less in the market. But in the long term, the shareholders of the company do not need to panic. Profit booking is always good in the stock market or in any stock in which any person is invested. Maruti Company is in strong hands and always did best for company share holders even company offers average 50rs per share dividend from last few years to their shareholders. It is investor’s friendly company.

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Disclaimer:  Discussion on Maruti suzuki company stock is my personal view. Please do your own research before taking any buying or selling decision.