Auto Stocks Outlook
Seen mixed next week; Fed meet in focus
This story was originally published at 21:14 IST on 13 September 2024
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MUMBAI – Shares of automobile companies are likely to see a mixed performance next week, according to analysts, with shares of two-wheeler companies expected to maintain positive momentum on the back of strong sales growth in the last few months. However, shares of passenger vehicle makers are likely to face challenges due to rising inventories with dealerships.
Investors remain optimistic about demand for two-wheelers during the festival season. However, alarming levels of passenger vehicle inventory has turned them cautious, said Rajesh Bhosale, technical analyst at Angel One. "Historically, the auto sector tends to pick up in September as the festive season begins, so it will be important to see if this pattern repeats this year. Additionally, the upcoming week will be crucial due to the scheduled key Fed policy announcement (where it is expected to cut interest rate)," Bhosale said.
Historically, central banks in emerging markets start easing interest rates after a rate cut by the Federal Reserve. In India, other than elections and uncertain weather conditions, higher financing costs have led led customers to postpone automobile purchases.
This week, the Nifty Auto index closed 1.2% higher on a week-on-week basis at 25820.85. Of the 16 constituents of the index, 14 gained and the rest closed lower. While Bajaj Auto and Bosch were among the top gainers this week, Tata Motors and Ashok Leyland were the only losers. Compared to the auto index, the benchmark Nifty 50 and the Sensex gained 2% and 2.1%, respectively, from a week ago.
TOP HEADLINES
* PRESS: New mobility scheme slashes incentives for electric vehicles
* Tata Power arm, Tata Motors in pact for e-vehicle charging stations
* M&M's total automobile output at 78,414 units in Aug, up 10% on year
* Maruti Suzuki launches three smart CNG variants of Epic New Swift
* Cabinet approves 109-bln-rupees scheme to promote e-vehicles
* Automakers assure FADA of dealer inventory dip during festival season
* Govt to announce phase 3 of FAME policy today, says Kumaraswamy
* Reports of JV with Volkswagen 'pure speculation' - M&M Automotive CEO
* Econ advisor sees vehicle sales rising in urban areas in coming mos
* E-vehicle sales to grow to 10 mln units annually by 2030 - Gadkari
* JSW MG Motor aims to cut stocks to 30 days by end of festive season
* Ashok Leyland raises FY25 capex estimate to 8-10 bln rupees
* Ashok Leyland to open 3-4 vehicle scrappage centres within a year
* Maruti Suzuki to launch over 500-km range e-vehicle in January
* CCI approves merger of Tata Motors Finance with Tata Capital
* Govt working on Bharat Stage VII emission norms, says road secy
* See FY25 auto output-linked plan spend at 30 bln rupees - govt source
* Tata Motors cuts prices of Tiago, Punch, Nexon e-vehicles
* Minister says focussing on e-vehicle charging infra to aid e-mobility
* Gadkari urges auto industry to support vehicle scrapping policy
* IPO Alert: Ather Energy files papers with SEBI for fresh issue, OFS
* Not against giving incentives for electric vehicles, says Gadkari
* Tata Motors cuts entry-level prices for its six key cars, SUVs
* India must aim to be hub for affordable auto parts - Maruti Suzuki MD
* Auto components body sees higher sales on festive demand, good rains
* Govt to extend e-mobility scheme till FAME-3 launch, Kumaraswamy says
* M&M subsidiary to launch new electric 4-wheeler 'e-ZEO' on Oct 3
* PRESS: Automakers to switch to retail sales data to end inventory row
* Reuters: Reliance Infra plans to manufacture e-vehicles, batteries
* Maharashtra OKs 1.2-trln-rupee invest in e-vehicle, semiconductor mfg
Following are the resistance and support levels for the sector's key stocks for next week, as per calculations based on their prices on the National Stock Exchange:
| Company | Price | Week-on-week change in % | Resistance | Support |
|---|---|---|---|---|
| Ashok Leyland | 245.65 | (-)0.90 | 249.80 | 243.10 |
| Bajaj Auto | 11737.15 | 8.40 | 11978.70 | 11567.60 |
| Eicher Motors | 4858.30 | 2.20 | 4909.30 | 4802.50 |
| Hero MotoCorp | 5795.80 | 0.90 | 5881.40 | 5727.20 |
| Mahindra & Mahindra | 2739.10 | 1.50 | 2783.30 | 2689.70 |
| Maruti Suzuki India | 12316.05 | 1.10 | 12438.00 | 12230.10 |
| Tata Motors | 992.10 | (-)5.50 | 1013.40 | 977.40 |
| TVS Motor Co | 2828.65 | 2.80 | 2855.50 | 2805.00 |
| Nifty Auto | 25820.85 | 1.20 | 25955.80 | 25650.70 |
| Nifty 50 | 25356.50 | 2.00 | 25497.90 | 25221.80 |
| S&P BSE Sensex | 82890.94 | 2.10 | 83318.70 | 82439.30 |
End
Reported by Darshan Nakhwa
Edited by Avishek Dutta
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