CLSA downgrades Maruti to 'sell' from underperform

Asia Pacific-focused broker CLSA in its latest report downgraded Maruti Suzuki to 'sell' from 'underperform', saying any recovery in demand for the passenger vehicle might not be as large as expected.

According to a Reuters report, the brokerage in its report said that the demand profile for the industry is changing in ways that don't favour Maruti: moving away from the small cars the auto maker dominates and into large cars and utility vehicles where Maruti's share is increasing but not enough to offset the impact from smaller cars.

"We believe that Maruti's stock is already pricing in a demand recovery and that a big leap of faith needs to be taken on 20 per cent-plus industry growth to be positive post recent rally," CLSA says in a note.