Brands that have been built up over the years with care and prudence hardly ever fail to deliver. When a seasoned and well-respected investor like Warren Buffett invests in brands like Coca Cola, Kraft, Gillette, and Johnson & Johnson, which are strong and formidable in their own right, it has a long purpose to serve. These brands have stood the test of the time and have delivered above average returns over a long period of time.

Strong management, good distribution network and extensive marketing have helped sustain the perception of such brands in the minds of investors. Hence, when there is a free fall in the market, investors like Buffett make the most of their funds by making big investments in such brands. These investors believe in the mantra: make hay even before the sun shines.

The present situation in the Indian markets provides a similar opportunity to investors. There are many strong brands which are available at a discount due to the general economic slowdown and a variety of other issues including operational problems. Today, when there has been a comprehensive fall across markets, the only differentiator that companies have is brands. Brands that elicit unwavering faith not only from the consumers, but also from prudent investors.

This week, we at the ET Intelligence Group highlight some companies, which are strong brands in their sectors, and are now trading at economical valuations. These are the companies which have outperformed the market consistently in the bull phase of the market. The steep fall in their stock prices present a good opportunity to the investors to accumulate them.

MARUTI SUZUKI

Maruti Suzuki, the leading player in the four-wheeler domestic passenger car segment, was hit hard by labour trouble at its facilities, in both the first and second quarters of this fiscal. High auto finance rates also had an impact with many consumers delaying purchase of passenger cars.

As a result, during the first half of FY12, the company's total income from operations fell by 6.3% y-o-y, while its net profit declined 25.8%. The company's car sales in terms of units also fell 10.6% y-o-y during this period. This left Maruti with an estimated 39% share of the domestic passenger car segment at the end of first half of FY12, a decline of almost 500 basis points from a year back.

The erstwhile government-controlled Maruti Udyog had also faced labour problems at its facilities for around two months during the later half of FY01. Total vehicle sales of the company fell nearly 13.6% y-o-y during FY01 as a result. But the company bounced back in subsequent years.

And despite the impact of the latest labour problems, analysts point to a possible revival in Maruti's performance over the next few quarters. The company has received bookings for nearly 100,000 units of the recently-launched new model of its Swift car.

Also, the supply of diesel engines to Maruti is expected to improve soon from about 20,000 units per month to 25,000 units at a time when diesel engine-run cars are in vogue. Another plus for the company is its country-wide distribution network at the end of March 2011 it had 933 outlets in 668 cities. In addition, its service network reaches 1,395 cities.