PSEC - Maruti Udyog

P-Sec report on Maruti Udyog:

Maruti reported robust volume growth of 23% y-o-y during June’08 aided by healthy growth in A2 segment of 38% y-o-y and good response to the new launch SX4 in A3 segment. The company sold 2500 units of SX4 and 7500units of Swift. The A3 segment grew by 46% y-o-y. Presently operating at over 100% capacity at Manesar plant a strong jump in volume in these segments is unlikely as new capacity with come on stream only in FY09. Impact from hardening interest rates were no seen in volumes growth however, we expect realizations to remain subdued. The stock trades at 13x its FY0 8P earnings, we maintain BUY.