The biggest automaker in the nation, Maruti Suzuki India, has had a difficult start to 2026. The stock has drastically changed direction after reaching a new record high in the first few trading sessions of the year. It is already down almost 25% from its top, wiping off a substantial Rs 1.32 lakh crore in investor value during that time.

The rate of this drop is noteworthy. The stock has dropped to about Rs 12,500 levels in less than three months from its peak of Rs 17,372, making it the worst-performing four-wheeler company this year. Hyundai Motor India is down 16%, and Mahindra & Mahindra is down 19%. Additionally, Tata Motors’ passenger cars have dropped by more than 15%.

What’s wrong with the business?

According to Jefferies, there are still worries about Maruti’s capacity to significantly increase its domestic market share and profitability, even though the demand for passenger vehicles (PV) in India is still strong and the company’s export prospects are promising. For FY26–FY28, the brokerage has reduced its EPS projections by 3%–5%. It has reduced the target price from Rs 17,500 to Rs 16,000 while maintaining a Hold rating.

Nomura has a similar opinion. It points out that the company’s emphasis on increasing volumes in lower segments, bolstered by capacity growth and its robust presence in entry-level categories, may put pressure on margins in the face of growing expenses. However, Maruti’s capacity to increase its overall market share may be constrained by the rising demand for SUVs. Nomura has a target price of Rs 16,118 and a Neutral rating.

Thus far in FY26, the company’s domestic PV wholesale market share has stayed below 40%. One of the main factors impeding performance in recent years has been a persistent drop in the market for small cars. Maruti also has capacity issues that make it difficult for it to completely satisfy demand. Although it can switch production between models thanks to its adaptable manufacturing setup, this has caused dispatch unpredictability in recent months.

This strain is seen in recent sales data. Domestic PV wholesales increased by just 0.1% year over year to 1,61,000 units in February, but otherwise remained relatively steady. At 10,238 units, the micro segment—which includes Alto and S-Presso—stayed the same. Hatchbacks continue to be weak, as evidenced by the small segment’s 8.99% fall to 66,386 units, which includes models like Baleno, Celerio, Dzire, Ignis, Swift, and WagonR.

Has the adjustment been made too much?

Some of these worries, according to Motilal Oswal, might be exaggerated. With a target price of Rs 17,406 and a buy rating, it indicates robust retail demand for both utility vehicles and passenger cars. According to the brokerage, capacity problems have limited wholesale volumes, but as new capacity comes online in April 2026, this should start to improve.

Additionally, it anticipates that Maruti will surpass industry growth in FY27 thanks to a robust pipeline of launches that includes the recently unveiled Victoris and e-Vitara, a new Brezza variation, and at least one additional model throughout the year.

Exports continue to be a positive aspect. As of February 2026, the business has already exceeded its FY26 export goal of 4,00,000 units. A 25% volume CAGR in exports between FY25 and FY28 is implied by its continued goal of 7,50,000 to 8,00,000 units by FY31.

GST 2.0, meanwhile, provides Axis Securities with a structural tailwind. Reduced taxes are anticipated to lower acquisition costs and increase demand for Maruti’s core lineup, which includes compact SUVs like Brezza and Fronx as well as hatchbacks like Alto, Swift, WagonR, and Baleno. The business may be able to recover some of the market share it has lost recently thanks to this.

With the introduction of new products like the eVitara and Victoris, the company is simultaneously improving its position in the utility vehicle market, which is expanding more quickly. As Maruti strives to reclaim its long-term market share target of 50%, a balanced presence across segments and coverage of all major powertrains, including ICE petrol, hybrid, CNG, and EVs, will be essential.

Volumes are predicted to increase at a CAGR of 7% between FY25–FY28E, with a slight increase in average selling prices due to a more diverse product mix. With sales, EBITDA, and PAT expected to expand at CAGRs of 12%, 11%, and 9%, respectively, over the same time, this should result in consistent financial growth, according to Axis.

Even while the overall demand climate is still favorable, Maruti Suzuki’s steep drop indicates a combination of short-term issues with market share, profits, and capacity limitations. The medium-term story depends on how quickly the company can execute fresh launches, scale up capacity, and reclaim lost position without sacrificing profitability, even though brokerages are divided.

(Disclaimer: The experts’ views, opinions, recommendations, and ideas are their own. These are not Business Connect Magazine’s opinions.

FAQs – Maruti Suzuki Share Crash 2026

Q1. Why have Maruti Suzuki shares fallen in 2026?

👉 The decline is due to concerns over market share loss, margin pressure, and capacity constraints, despite strong overall demand in the passenger vehicle segment.

Q2. How much has Maruti Suzuki stock fallen in 2026?

👉 The stock has dropped लगभग 25% from its peak, wiping out around ₹1.32 lakh crore in market value.

Q3. What are brokerages saying about Maruti Suzuki stock?

👉

• Jefferies: Hold rating, target cut to ₹16,000

• Nomura: Neutral rating, cautious on margins

• Motilal Oswal: Buy rating, sees long-term growth

• Axis Securities: Positive on future demand and GST benefits

Q4. Is Maruti Suzuki losing market share?

👉 Yes, its domestic passenger vehicle market share has remained below 40% in FY26, mainly due to declining demand for small cars and rising SUV competition.

Q5. How are Maruti Suzuki’s sales performing?

👉 Sales growth has been almost flat, with domestic wholesales rising just 0.1% year-on-year in February 2026.

Q6. What are the major challenges facing Maruti Suzuki?

👉 Key challenges include:

• Weak demand in small car segment

• Rising input costs affecting margins

• Capacity constraints limiting supply

• Growing competition in SUVs

Q7. Are there any positive factors for Maruti Suzuki?

👉 Yes, positives include:

• Strong export growth

• Upcoming new launches (e-Vitara, new Brezza, Victoris)

• Expected capacity expansion from April 2026

Q8. What is the future outlook for Maruti Suzuki stock?

👉 The outlook is mixed:

• Short-term: Pressure due to margins and market share

• Medium to long-term: Growth expected from new launches, exports, and capacity expansion

Q9. Is the stock correction overdone?

👉 Some analysts believe the correction may be overdone, while others expect continued volatility depending on execution and demand trends.

Q10. How does Maruti Suzuki compare with peers?

👉 In 2026:

• Maruti Suzuki: down ~25%

• Hyundai Motor India: down ~16%

• Mahindra & Mahindra: down ~19%

• Tata Motors (PV): down ~15%

👉 Making Maruti Suzuki the worst-performing auto stock among peers.