Big mighty organisations which have survived the test of time are great because they are great, sounds obvious isn’t it? Worlds greatest organisations have grown amidst all the adversity they face and even come ahead of competition and maintain there status inspite of all evil.
Above statement i made after analyzing Maruti which was a missed investment opportunity a year ago, We never realized what was transforming underneath at Maruti. Just looking back 2 years into Maruti’s car sales and the new models not taking off and intense competition from global majors Hyundai, Nisson, Chevorlet, Toyota, Honda, Volkswagon. Not many would have expected if an ernstwhile auto major have much impact going further in the competition, but the resurgence of Maruti shows the mettle underneath such organisation.
The new models have taken the automobile market by a storm, the Nexa variants and the new Breeza sales are much higher compared to the competitors. I was comparing Breeza with its competitors and felt it was way ahead of its competition in the segment, for a cost conscious Indian market which asks “Kitna detha hai”, Breeza with lower power and higher mileage but looks comparable/superior than competition in the segment should easily be the most sought vehicle.
Indian markets matured slowly and started looking for upgrade options from Maruti 800/Alto to a higher version but for quite few year Maruti lacked models which could cater to these needs. The brand recall for the brand Maruti was always their and when a few models in these segments where launched they were up for a grab. What Maruti lacks now is a premium sedan which compete the lights of a Skoda, Honda Civic and others in this space, they have a Ciaz which hasn’t taken off if they get the ball rolling here then we could expect them again beat the competition and they would be ‘Going the Distance’
Every now and then find a large corporation struggling and re-surge from those levels to again be the top company. A prudent investor should make a 30-40% return on such moves if one is identified in early stages. Whenever a large organisation is having such issues for more than a few quarters it is time to search for an opportunity if you find one then invest. In plain investment jargon ‘Buy when not many want to buy, Sell when not many want to sell'(Be greedy when others are fearful and fearful when others are greedy).
Disclaimer : This is not a recommendation to buy Maruti, it just gives an insight on how great companies re-emerge from doldrums.