Maruti surges; CLSA says stock can double

Reuters Market Eye - Maruti Suzuki India surges 5.1 percent to 2,279.60 rupees after CLSA says the stock price could double in three years in a bull scenario in which personal vehicle industry volume grows at a compounded annual growth rate of 20 percent due to pent-up demand should the economic growth pick up.

Still, CLSA says its base case remains a 14 percent industry growth in personal vehicle demand over fiscal years 2015 to 2017, although it notes "actual growth could be closer to around 20 percent."

CLSA also notes Maruti Suzuki has a "strong" product cycle starting in fiscal 2015, thus raising hopes about its market share.

 

CLSA reiterates Maruti as its top pick among India's automobile stocks while maintaining its 'buy' rating.

(Reporting by Abhishek Vishnoi)