MARUTI SUZUKI CELERIO User Manual download pdf

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PleaserefertoDisclosuresandDisclaimersattheendoftheResearchReport.

MarutiSuzuki

CelerioAMTtestdrive‐Willithaveabroadbasedappeal?

AUTOMOBILES:CompanyUpdate

26February2014

PhillipCapital (India) Pvt. Ltd.

We(myselfand4other colleagues includingafemale driver) took a testdrive

of Maruti’s Celerio with Automated Manual Transmission technology. On the

positiveside,theAMT offers convenience(particularlyintraffic )withgreatfuel

economyandintheclutchlessmanualmodetherideisprettysmooth.Onthe

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otherhand,intheautomaticmode,thegearshiftsareunevencontributingtoa

poorride.Also,theproductseemstohavebeenpricedatadbitonthehigher

side. Overall, while it is certain to attract attention, it remains to be seen

whether the vehicle appeals to a

broadbaseofconsumers or will be confined

toanichecategory(firsttimedrivers;women).

Is the AMT smooth enough?The AMT version has the option of driving in an

automatic mode or in a clutchless manual mode. Our experienceswith the two

werevastlydifferent.

• Automaticmode:The

AMTisnotaconventionalautomatic(itdoesnothave

torqueconvertor)–itbasicallyutilizeshydraulicandelectricalactuatorsto

automatethegearshifts(readpage4fordetails).Whilethisensur eshigh

fueleconomyandlowercosts,itleadstoacompromisedridequality.During

thegearshifts

therewasaperceptiblepowerloss.Thelackofextra

accelerationmakesovertakingalittlechallenging.

• Manualmode:Inthemanualmode,thevehicleisasresponsiveasanyother

manual.Theclutchlesstransmissionmakesdrivingeasierwithoutaffecting

thedrivequality.Thefactthatthegearsautomaticallydownshift

toprevent

theenginefromstallingisafurtherconvenience.

Isthepriceaggressiveenough?Onthepositiveside,theAMTispricedjustabout

Rs 45,000 more than the Celerio’s manual version. This compares favourably to

conventional automatics that are typically priced ~Rs100,000 more than the

manualversions.

However,

 on an absolute level, the price of the Celerio AMT is higher than the

effective on‐road price of a similar version of the Ritz and ~ 6% lower than the

Swift.Hence,abuyer would face the dilemma of choosing between apremium,

morepowerfulbetterfeaturedhatchbackand

theCeleriowiththeAMT.

Does the car have enough features?Maruti seems to have gone ahead with a

“safe”lookfortheCelerio–therearhasthelooksoftheAltowhilethefronthas

wrap around lamps (ala the Stingray). Overall, the vehicle is unlikely to attract

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attentionbutwillnotturn offtoomanypeople.Ontheotherhand,theinteriors

seemroomierthantheWagonRbutfallsshortofthespaceinaSwift/Ritz.

Further while the car has a feature list worthy of an entry level hatchback; it

pales when compared to a

 Swift/Ritz. This is important considering the minimal

pricedifferentialbetweentheC elerioAMTandtheRitz/Swift.

Outlook – strong innovation; trying to create a market. MSIL has taken a bold

moveintryingtoshifttheIndianmarkettowardstheautomatic.Webelievethat

while the technology offers great

convenience, the diffident ride quality and

slightly higher price point may be a deterrent. While the vehicle will definitely

attractattention,itsappealtoabroadcustomerbasemaynotbeacertainty.

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NEUTRAL

MSILIN|CMPRS1666

TARGETRS1520(‐9%)



CompanyData

O/SSHARES(MN): 302

MARKETCAP(RSBN): 506

MARKETCAP(USDBN): 8.2

52‐WKHI/LO(RS): 1860/1215

LIQUIDITY3M(USDMN): 26.9

FACEVALUE(RS): 5

ShareHoldingPattern,%

PROMOTERS: 56.2

FII/NRI: 21.6

FI/MF: 14.0

NONPROMOTERCORP.HOLDINGS: 6.1

PUBLIC&OTHERS: 2.2

PricePerformance,%

1mth 3mth 1yr

ABS‐5.4 ‐0.1 16.2

RELTOBSE‐4.1 ‐1.3 8.3

PriceVs.Sensex(Rebasedvalues)

100

120

140

Apr‐10 Jun‐11 Aug‐12 Oct‐13

Maruti BSE Sensex

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Source:Bloomberg,PhillipCapitalIndia

Research

OtherKeyRatios

Rs,mn FY14E FY15E FY16E

NetSales 413,411 471,751 541,448

EBITDA 52,581 60,317 67,136

NetProfit 28,585 33,321 38,131

EPS,Rs 94.6 110.3 126.2

PER,X 17.7 15.2 13.3

EV/EBIDTA,x 9.5 8.1 6.9

EV/NetSales,x 2.5 2.2 1.9

ROE,% 14.1 14.3 14.2

Debt/Equity(%) 6.9 6.0 5.2

Source:PhillipCapitalIndiaResearchEst.



DeepakJain(+912266679758)

[email protected]



PriyaRanjan(+912266679965)

[email protected]

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Summary of Contents

Page 1 - MarutiSuzuki

PleaserefertoDisclosuresandDisclaimersattheendoftheResearchReport.MarutiSuzukiCelerioAMTtestdrive‐Willithaveabroadbasedappe

Page 2

–2of8–26February2014/INDIAEQUITYRESEARCH/MARUTISUZUKICOMPANYUPDATENetofdiscountstheCelerioAMTVXIwouldbemoreexpensivethant

Page 3

–3of8–26February2014/INDIAEQUITYRESEARCH/MARUTISUZUKICOMPANYUPDATETheCeleriohas“safe”looks‐therearhassimilaritieswiththe

Page 4

–4of8–26February2014/INDIAEQUITYRESEARCH/MARUTISUZUKICOMPANYUPDATETheAMTfeltalittleunevenparticularlyatthelowergears  

Page 5 - Financials

–5of8–26February2014/INDIAEQUITYRESEARCH/MARUTISUZUKICOMPANYUPDATEFinancialsIncomeStatementY/EMar,Rsmn FY13 FY14E FY15E FY1

Page 6 - RecommendationChart

–6of8–26February2014/INDIAEQUITYRESEARCH/MARUTISUZUKICOMPANYUPDATERecommendationChartN(TP1520)N(TP1520)S(TP1100)S(TP1070)N

Page 7 - –7of8–

–7of8–26February2014/INDIAEQUITYRESEARCH/MARUTISUZUKICOMPANYUPDATEManagement(9122)23002999(9122)66679735ResearchEngineering,

Page 8 - –8of8–

–8of8–26February2014/INDIAEQUITYRESEARCH/MARUTISUZUKICOMPANYUPDATEDisclosuresandDisclaimersPhillipCapital(India)Pvt.Ltd.hast