Auto giant, Maruti Suzuki has emerged as technical pick of brokerage Prabhudas Lilladher. On November 27, the stock price gained to above Rs 11,100 levels, and it is expected to see further potential upside. Prabhudas has set a target price of Rs 13,000. But its not just Maruti, but there is opportunity to even gain free bonus shares. Marut-backed subsidiary Bharat Gears which is also listed on exchanges, has declared a bonus issue of 1:1.
Maruti Suzuki Share Price:
On BSE, after market hours of November 27, Maruti stock price ended at Rs 11,058 per share, up by Rs 113.70 or 1.04% with an m-cap of Rs 3,47,666.37 crore. The stock's 52-week high and low is at Rs 13,675 apiece and Rs 9,738.40 apiece respectively.
Its price-to-equity ratio is at 25.33x, while its return on equity is at 15.72%. At the current market valuation, Maruti Suzuki is India's largest automobile company and stock.
BUY Maruti Suzuki Share Price:
In a note on November 27, Vaishali Parekh, Vice President - Technical Research at Prabhudas Lilladher said, the stock has witnessed a significant erosion from the 13,550 zones with recently finding some consolidation near the long-term trendline support zone of 10,800 levels with the improvement of bias witnessed.
Parekh's note added that the RSI has slipped deep into the oversold zone currently witnessing a pullback to improve the bias and signalling a buy.
"With the chart technically looking attractive, having much upside potential from current, we anticipate further rise and can carry on with the positive move further ahead," Parekh added, "We suggest to buy the stock for an upside target of Rs 13,000, keeping the stop loss of Rs 10,300 level."
Bharat Seats Bonus Issue:
Maruti's subsidiary, Bharat Seats is going to issue bonus shares of 1:1 ratio. This would mean that the company will issue 1 (one) Bonus Share for every 1 (one) Equity Share held by the Equity Shareholders of the Company as of 'Record Date'.
The company will issue up to 3,14,00,000 Equity Shares at a face value of Rs. 2/- each. These bonus shares will be issued out of free reserves of the Company available as of 31st March 2024 based on the Audited Financial Statement as of 31st March 2024. Up to Rs 6,28,00,000/- is required for implementing the Bonus Issue.
The company plans to complete its bonus issue action within 2 months from the date of the Board's approval i.e. by January 4, 2025.
According to Bharat Seats, the Bonus Shares if allotted shall rank pari-passu in all respects and carry the same rights of the existing Equity Shares and shall be entitled to participate in full in any dividend and corporate action(s), recommended and declared after the issue and allotment of such Bonus Shares.
Bonus shares are one of the many corporate actions that listed companies announce on several occasions. Bonus shares are like incentives which are free of cost given to investors. Under this corporate action, new shares are issued at the existing Face Value of equity shares of the company. Hence, the face value remains the same post-bonus issue.
At present, Bharat Seats' share price was at Rs 206.55 apiece, up by 1.9% on BSE with market cap of Rs 648.57 crore.
Bharat Seats Ltd is a joint Venture of Suzuki Motor Corporation Japan, Maruti Suzuki India Ltd, Rohit Relan and Associates with the aim to manufacture complete seating systems and auto components.
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