Maruti Suzuki Stock Drops After Q3 Results
Maruti Suzuki landed in the spotlight after its December-quarter earnings, but the market reaction was clearly negative. Shares of the country’s largest carmaker slipped about 3.4% intraday to ₹14,370 on the BSE on Thursday, as investors digested a mixed earnings report that fell short of Street expectations.
The stock later ended the session around 2.4% lower at ₹14,877 on the NSE, underperforming broader market cues.
On the surface, the company delivered record sales and a sharp jump in revenue, but profitability growth looked modest, and margins came under pressure. That gap between volume and earnings is what spooked traders.
Q3 FY26 Financial Performance: Revenue Strong, Profit Soft
For the December quarter, Maruti Suzuki reported a standalone profit of about ₹3,794 crore, up roughly 4% year-on-year. Revenue surged close to ₹49,891 crore, marking a strong 29% annual growth, driven by higher domestic volumes and better demand conditions.
Sequentially, profit grew around 15% quarter-on-quarter, while revenue climbed about 18%. Operationally, the business scaled up well, but analysts had expected stronger margins and higher bottom-line growth.
Margins Under Pressure Despite Record Sales
Sales volumes told a different story. Maruti posted record domestic and total sales for the quarter. Domestic volumes crossed 564,000 units, while total sales, including exports, reached around 667,000 units.
Small car demand showed a visible revival, helped partly by GST-related tailwinds and improving affordability. However, margins were weighed down by lower export realisations and a one-time provision of about ₹594 crore related to new labour codes.
This combination kept profitability below Street estimates, even though revenue momentum looked impressive.
Brokerage View: Long-Term Positive, Near-Term Earnings Cut
Brokerages are still broadly constructive on Maruti Suzuki’s long-term outlook. Motilal Oswal reiterated a buy call and raised its target price to around ₹18,197, citing strong demand, upcoming product launches, and improving market share prospects.
However, analysts trimmed earnings forecasts by about 4% for FY26 and 7% for FY27 due to margin pressures and export pricing challenges. They still expect around 16% earnings CAGR over FY25–FY28, assuming demand remains healthy and new launches gain traction.
There is also a view that a recovery in market share could trigger a valuation rerating over time.
Stock Performance and Technical Signals
In the near term, technical indicators show weakness. The stock is trading below key moving averages, signaling a soft trend. The 14-day RSI has slipped into oversold territory, suggesting a short-term bounce is possible, but the broader trend remains cautious.
Over the last month, Maruti shares are down around 10%, while the stock is still up roughly 23% over the past year, reflecting longer-term optimism.
Maruti Suzuki Q3 FY26 Key Data Snapshot
| Metric | Q3 FY26 Data | YoY Change |
|---|---|---|
| Net Profit | ₹3,794 crore | +4% |
| Revenue | ₹49,891 crore | +29% |
| Domestic Sales Volume | 564,669 units | Record |
| Total Sales (Incl. Exports) | 667,769 units | Record |
| One-time Labour Provision | ₹594 crore | – |
| Stock Intraday Low | ₹14,370 | −3.4% |
| NSE Close Price | ₹14,877 | −2.42% |
| Brokerage Target (Motilal Oswal) | ₹18,197 | Buy |
What Investors Should Track Next
Margins will be the key variable. Export pricing, commodity costs, and regulatory expenses will decide whether earnings catch up with revenue growth. New model launches and market share recovery could act as positive triggers, while any slowdown in small car demand may cap upside.
Bottom Line:
Maruti Suzuki delivered strong revenue growth and record sales, but earnings missed expectations due to margin pressures and one-off costs. The long-term story remains intact, but near-term volatility is likely.
For investors, the stock looks like a hold with a long-term buy bias on dips, provided margins stabilise and demand stays resilient.
FAQ
Q1. Why did Maruti Suzuki shares fall after Q3 results?
Maruti shares dropped because profit growth was modest and margins disappointed analysts despite strong revenue and sales growth.
Q2. What were Maruti Suzuki’s Q3 FY26 profit and revenue?
The company reported a profit of around ₹3,794 crore and revenue of about ₹49,891 crore.
Q3. Did Maruti Suzuki miss analyst expectations?
Yes, the results missed Street expectations mainly due to margin pressure and one-time labour code provisions.
Q4. What is the brokerage target price for Maruti Suzuki?
Motilal Oswal has a Buy rating with a target price of around ₹18,197.
Q5. Is Maruti Suzuki stock a good buy now?
Brokerages remain positive long-term, but near-term volatility is expected. Many analysts suggest buying on dips if margins improve.
