Auto Stocks Outlook
May fall on Israel-Iran tensions; SIAM data eyed
This story was originally published at 21:40 IST on 13 June 2025
Register to read our real-time news.Informist, Friday, Jun. 12, 2025
MUMBAI – Shares of automobile and auto-ancillary companies may fall if the tensions between Israel and Iran worsen over the weekend, analysts said. While the improved domestic macroeconomic situation may give automobile stocks an impetus, the prevailing crisis on procuring rare earth elements from China may cap gains for some.
Updates on US President Donald Trump's decision on tariffs on automobile imports will also be closely monitored. Investors will also keep an eye on the monthly sales data for May, to be released by the Society of Indian Automobile Manufacturers 1100 IST Monday.
Currently, there is a positive shift on the macroeconomic front with headline inflation for May coming in below 3% and the Reserve Bank of India cutting its policy rate by a robust 50 basis points. The forecast of a favourable monsoon and the tax rebate in the Budget for the financial year 2025-26 (Apr-Mar) are expected to spur demand in urban areas. Rural demand has also shown a rise in the past few weeks with the early onset of the southwest monsoon and the marriage season in May-June.
However, there is a near-term supply-side crisis with respect to rare earth elements from China for select players such as Maruti Suzuki India and two-wheeler companies such as TVS Motor Co., Hero MotoCorp, and Bajaj Auto. The motors for electric two-wheelers need some rare earth elements for smooth functioning and to avoid noise, analysts said, and most Indian two-wheeler manufacturers depend on supplies from China. These manufacturers do not maintain large inventories of these elements for reasons of cost, they said. While reports suggest some companies are trying to replace these elements with light earth magnets, industry experts say this could affect the performance of the vehicles.
"China has said that companies can procure these elements if there is assurance that such elements would not be used for defence purposes," Saral Seth, research analyst at IndSec Securities, said. "This may require rigorous paperwork for companies to work on, and rest assured, Indian automobile manufacturers would be preparing for the same so that production in August will be smooth." Seth said the companies have stocks of these elements that will last until July, but if the situation is not rectified by then, these original equipment manfacturers may face production issues thereafter.
Friday, the Nifty Auto index closed slightly lower at 23327.40 points. The index closed 1.4% lower on a week-on-week basis. Bajaj Auto and MRF were the top gainers in the sectoral index. Tube Investments of India and Mahindra & Mahindra fell the most during the week among the nine stocks that closed in the red.
TOP HEADLINES
* HCL Tech in pact with Volvo Cars to provide engineering services
* No disruption due to dearth of rare earth magnets for EVs - Maruti Suzuki
* UK-based hedge fund sells minor shr in M&M, ICICI Bk, Eternal in block deals
* NCLT forgoes shareholders meet for Suzuki Motor Gujarat-Maruti Suzuki merger
* Minda Corp signs JV pact with Japanese co to make, sell automotive switches
* Gave no specific indication to media of launches overseas, says JBM Auto
* PRESS: Maruti Suzuki trims e-Vitara H1 output aim two-thirds to 8,221 units
* China's rare earth magnets export curbs may impact India's EV growth - Crisil
* Olectra Greentech CMD KV Pradeep resigns, co to inform effective date later
* ANALYSIS: Low India sales growth hurts auto cos Q4; ancillaries beat Street
* Two-wheeler sales to rise 8-9% FY26, top pre-COVID levels - CareEdge Ratings
* Tata Motors to spend up to INR 350 bln till FY30 on growth, list CV co by Dec
* ZF Commercial Vehicle promoter offloads 3.16% stake in Co for INR 7.91 bln
* M&M total May vehicle sales volume 80,458, dn 0.4% on month, up 17% on year
Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:
| Company | Price | Week-on-week change in % | Resistance | Support |
| Apollo Tyres | 451.95 | (-)4.10 | 466.30 | 432.90 |
| Ashok Leyland | 234.80 | (-)3.00 | 238.30 | 228.90 |
| Bajaj Auto | 8,463.50 | (-)2.00 | 8,568.50 | 8,297.50 |
| Balkrishna Industries | 2,463.80 | (-)1.20 | 2,503.60 | 2,401.20 |
| Bharat Forge | 1,309.30 | 1.00 | 1,342.40 | 1,254.40 |
| Bosch | 31,585.00 | (-)0.00 | 32,205.00 | 30,635.00 |
| Eicher Motors | 5,319.00 | (-)1.40 | 5,404.70 | 5,176.70 |
| Exide Industries | 384.85 | (-)2.20 | 397.40 | 370.80 |
| Hero MotoCorp | 4,333.80 | 1.50 | 4,406.30 | 4,215.10 |
| Mahindra & Mahindra | 3,006.00 | (-)3.20 | 3,072.00 | 2,899.00 |
| Maruti Suzuki India | 12,408.00 | (-)0.40 | 12,585.30 | 12,087.30 |
| MRF | 137,620.00 | (-)1.40 | 139,873.30 | 133,873.30 |
| Samvardhana Motherson International | 154.01 | (-)2.20 | 157.00 | 148.50 |
| Tata Motors | 712.05 | 0.20 | 725.10 | 691.80 |
| TVS Motor Co. | 2,740.90 | (-)0.30 | 2,807.30 | 2,621.90 |
| Nifty Auto | 23327.40 | (-)1.40 | 23652.20 | 22753.20 |
| Nifty 50 | 24718.60 | (-)1.10 | 24930.00 | 24367.30 |
BSE Sensex | 81118.60 | (-)1.30 | 81788.00 | 80019.90 |
End
Reported by Gopika Balasubramanium
Edited by Rajeev Pai
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