Maruti Suzuki share price down 5%; Here’s what’s going on with the company

Synopsis: The shares of Maruti Suzuki are down by 5% in the Intraday trade, snapping a six-day winning streak in the process, and this is the biggest single-day fall for Maruti in the last 11 months. In this article, let’s see the reason for the fall.

The shares of Large-Cap Company, specializing in manufacturing and selling affordable, fuel-efficient passenger cars, utility vehicles, and small cars for the Indian market, are in focus as they have declined by upto 5 percent in the intraday trade. In this article, let’s explore the reason for the fall.

With a market capitalization of Rs. 5,28,667.93 Crores on Wednesday, the shares of Maruti Suzuki India Ltd declined upto 4.5 percent, reaching a low of Rs. 16526.10 compared to its previous closing price of Rs. 17294.95.

What happened

Maruti Suzuki India Ltd, engaged in manufacturing and selling affordable, fuel-efficient passenger cars, utility vehicles, and small cars for the Indian market, has been in the spotlight as shares down on Wednesday, January 7, snapping a six-day winning streak in the process, and this is the biggest single-day fall for Maruti in the last 11 months.

Reason for the Fall

Declining Market Share

According to vehicle registration data released by the Federation of Automobile Dealers Association (FADA), Maruti Suzuki’s market share fell below 40% in 2025, reaching 39.91%, down from around 44% in 2021. This steady decline over five years shows that the company is gradually losing its grip on the Indian passenger vehicle market.

Rising Competition from Domestic Rivals

Mahindra & Mahindra and Tata Motors have strengthened their positions in the market. By introducing attractive and modern SUVs, they have successfully drawn customers away from Maruti Suzuki, reducing its dominance.

Shift in Consumer Preferences

Indian buyers are increasingly favoring SUVs and compact SUVs over hatchbacks and sedans, segments where Maruti traditionally excelled. This change in preferences has disadvantaged Maruti, which was slower to expand in the SUV segment.

Structural Shift in the Auto Industry

The combination of stronger competition and evolving consumer tastes points to a long-term structural change in India’s automotive market, signaling that Maruti can no longer rely solely on its legacy and brand recognition.

Volume Spike Observed

The stock experienced a substantial sell-off, accompanied by a notable surge in trading activity. On this day, the trading volume reached 427.95 K shares, significantly higher than the stock’s average daily volume of 313,757 shares. This represents a sharp increase in market participation, suggesting heightened investor activity and possible strong reactions to news, earnings, or other market-moving events.

Key Technical Factors

The stock was recently trading in the overbought zone, with the RSI above 70, and was positioned well above both its 50-day and 200-day moving averages, indicating strong stretched momentum.

Financials

The company’s revenue rose by 13.07 percent from Rs. 37,449 crores to Rs. 42,344 crores in Q2FY25-26. Meanwhile, Net profit rose from Rs. 3,102 crores to Rs. 3,349 crores in the same period.

The company shows strong profitability with a ROCE of 21.7% and ROE of 15.9%, and its debt-free balance sheet underscores financial stability. Its PEG ratio stands at 0.49, which indicates an attractive valuation relative to growth.

Along with it, it has delivered impressive profit growth of 34.7% CAGR over five years while maintaining a 30.5% dividend payout, reflecting a good balance between growth and shareholder returns.

In December 2025, total production of passenger vehicles reached 208,591 units, up from 155,553 units in December 2024. The Mini and Compact segment (including models like Alto, S-Presso, Baleno, Swift, WagonR, and others) accounted for 108,462 units, showing strong growth from 77,524 units the previous year. 

The Utility Vehicles segment, including Brezza, Ertiga, Fronx, Jimny, XL6, and others, produced 87,451 units, up from 64,212 units in 2024. Vans, represented by the Eeco, saw stable production at 12,678 units, slightly lower than 12,788 units in the previous year.

For Light Commercial Vehicles, the Super Carry recorded 3,348 units, increasing from 2,101 units in December 2024. Overall, combining passenger and light commercial vehicles, the grand total production reached 211,939 units, compared to 157,654 units in December 2024, reflecting strong year-on-year growth.

Maruti Suzuki India Limited is India’s largest passenger car manufacturer, a subsidiary of Japan’s Suzuki Motor Corporation, known for making vehicles affordable and accessible since its 1981 joint venture with the Indian government, ushering in India’s automobile revolution with models like the iconic Maruti 800, and today offers a wide range of cars, commercial vehicles, and related services, focusing on sustainable mobility and technological innovation for the Indian market. 

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