Auto Stocks Outlook
Seen range-bound next week; retail sales in focus
This story was originally published at 21:46 IST on 4 October 2024
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MUMBAI - Shares of automobile companies are likely to see range-bound movement next week as investors expect a decline in retail sales in September due to weak demand during festivals, and due to an inauspicious Shraddh period falling in the month, according to analysts. The Federation of India Automobile Dealers Associations of India is likely to disclose September sales data next week.
This week, the Nifty Auto index was the worst performer among the benchmark indices. While the auto index declined by 6.1% on a week-on-week basis, the Nifty 50 and the Sensex closed 4.5% lower. Of the 15 constituents of the Nifty Auto index, all closed lower over the previous week. TVS Motor Co., Hero MotoCorp, and Bajaj Auto were among the worst hit stocks from the space. Next week, resistance for the Nifty Auto index is seen around 26600 and support at 25500.
The auto sector stands close to its long-term trendline support coupled with 50-day moving average and if the sector reverses from the mentioned support points, then trend continuation is expected or else some more corrections can be seen in the case of a breakdown, said an analyst at a domestic brokerage.
The auto index has rallied substantially this year, and was near the overbought zone before the correction this week. Investors have started booking profits in the auto space ahead of the Jul-Sep earnings announcements and on account of escalation in geopolitical tensions in West Asia and expensive stock valuations, the analyst said.
TOP HEADLINES
* M&M arm launches electric CV Mahindra ZEO starting at INR 752,000
* Maruti Suzuki Sept total production down 9% on year at 159,743 units
* M&M gets 176,218 orders for Thar Roxx within 60 minutes of opening bookings
* Ashok Leyland in pact with Nidec Motor to develop motors for electric CVs
* Bharat Forge arm to sign pact with US cos for making artillery gun platforms
* Eicher Motors September motorcycle sales up 11% on year at 86,978 units
* IPO Alert: Viney Corp files papers for issue of INR 1.5 bln to repay debt
* Hero MotoCorp Sept total sales volume up 19% on year at 637,050 units
* Maruti Suzuki Sept sales up 2% on yr to 184,727 units led by SUVs, exports
* Hyundai Motor registers total sales of 64,201 units in September
* Tata Motors September CV sales down 23% on year, PV sales down 9%
* TVS Motor Sept total sales up 20% on year at 482,495 units
* Eicher Motors Sept commercial vehicle sales up 5.7% on year at 7,609 units
* Ashok Leyland's Sept total vehicle sales down 10% on yr at 17,233 units
* M&M Sept sales 87,839 units, up 16% on year, 14% over Aug
* Escorts Kubota total tractor sales up 2.5% on year at 12,380 units in Sept
* Bajaj Auto's total sales in Sept up 20% on year at 469,531 units
* IPO Alert: Hyundai Motor gets SEBI approval for public issue via OFS
* Motilal Oswal sees Sep auto retail sales dn on weak demand, Shraddh period
* Eicher Motors to replace reflectors on select batch of Royal Enfield bikes
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 | 225.39 | (-)5.90 | 235.20 | 219.00 |
| Bajaj Auto | 11774.40 | (-)7.00 | 12096.50 | 11477.90 |
| Eicher Motors | 4706.80 | (-)7.00 | 4845.40 | 4621.50 |
| Hero MotoCorp | 5520.85 | (-)7.30 | 5717.60 | 5385.70 |
| Mahindra & Mahindra | 3017.45 | (-)5.20 | 3209.60 | 2913.40 |
| Maruti Suzuki India | 12605.75 | (-)6.60 | 13030.70 | 12300.00 |
| Tata Motors | 930.75 | (-)6.30 | 962.50 | 904.10 |
| TVS Motor Co | 2687.50 | (-)8.90 | 2792.20 | 2605.60 |
| Nifty Auto | 25926.30 | (-)6.10 | 26674.20 | 25476.50 |
| Nifty 50 | 25014.60 | (-)4.50 | 25673.70 | 24637.20 |
| S&P BSE Sensex | 81688.45 | (-)4.50 | 84032.10 | 80360.80 |
End
Reported by Darshan Nakhwa
Edited by Manisha Baxla
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