Maruti stocks up on bets Ertiga model will really see 'LUV'

Apr 20, 2012 |

Mumbai

Reuters

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Maruti Suzuki has plastered India with its 'Live life with LUV (Life Utility Vehicle)' adverts as it promotes its new Ertiga model, and stock investors appear to have responded in kind.

As of Thursday's close, Maruti stocks had surged 9.3 per cent since the launch of the model on April 12, versus a 2 per cent gain in the broader Nifty index, after analysts cited the competitive pricing for the model.

Shares in India's biggest car maker Maruti Suzuki added 1.1 per cent on Friday, extending the rally after executives have been making media appearances citing the auto maker has received over 10,000 bookings in the first five days of sales.

"Even as the product has lower engine power, Ertiga initial response is better than expectations as it carries a competitive pricing and higher mileage tag with it," said Deepak Jain, a sector analyst at brokerage Sharekhan.

"Large proportion of Ertiga sales is expected to be for the diesel variants," Jain said.

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