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Informist, Friday, Nov. 21, 2025

MUMBAI – Analysts are bullish on automobile stocks in the near term, mainly on expectations of robust volume growth in the coming months and strong earnings growth in the December quarter. The consensus is that consumer-facing sectors, including automobiles, will see an uptick in earnings on the back of lower interest rates, goods and services tax cuts, and discounts. The robust southwest monsoon season earlier this year is also seen as a contributory factor.

Seasonally, November and December see low automobile sales volumes as the festival season exhausts demand. However, this year, some analysts expect demand to be sustained on the back of reduced prices and lower GST, especially for passenger vehicles. Analysts also said there are more "auspicious" days in the wedding season in November than there were a year ago, which would also support volume growth for cars as well as two-wheelers.

"Generally, in November and December, volumes are low, but we are assuming, as the prices have already come down for vehicles, demand should be there," Ravi Gupta, research analyst tracking automobile companies at InCred Equities, said. "Also, first-time buyers take a lot of time to understand what the pricing is and what their budgets are before they consider buying a vehicle," he said, adding that "those who have delayed their purchases are going to do it in November and December".

As for valuations, Gupta said that barring Mahindra & Mahindra and TVS Motor Co., all other automobile companies are fairly valued. He sees "good" upside in the share prices of Maruti Suzuki India and Hero MotoCorp. He also said there are chances that automobile companies would start increasing their volume growth guidance, which would drive stock prices in the near term.

Moody's Ratings has raised the sales growth forecast for light vehicles for 2026 while maintaining the forecast of 5% growth for 2025 in its latest report. The rating agency expects light vehicle sales to rise 5% in 2026 as well, up from the previous forecast of 2.5% growth. "Policy changes, including recent tax reductions and lower vehicle prices, support demand in this price-sensitive market," Moody's Ratings said. "Demographic factors such as the country's young population and low car ownership rate remain long-term demand catalysts," it added.

Friday, the Nifty Auto closed flat at 27537.85 points. During the week, the index rose over 1%. For the week, Tube Investments of India and Ashok Leyland fell the most while Hero MotoCorp and Eicher Motors saw the most gains. "Nifty Auto is on the verge of a potential breakout after prolonged consolidation," Ashish Sherigar, technical analyst at NVS Brokerage, said. "A sustained move above 27,750 can trigger a strong upside, keeping the broader trend firmly bullish."

TOP HEADLINES

* Ather Energy launches Rizta in Sri Lanka in partnership with Evolution Auto
* Ashok Leyland partners with FAMCO Qatar to strengthen presence in Qatar
* CareEdge sees FY26 PV volumes rising 4% YoY on GST cuts, low finance cost
* SIAM says western India saw highest sales of CV, PV, 2-wheelers in Q2
* Escorts Kubota launches third-generation ride-on-rice KA6, KA8 transplanters
* Tata Sons, other promoters hold 42.71% stake in Tata Motors post demerger
* Ola Electric commences test rides of 4689 Bharat Cell-powered vehicles
* Analyst Concall: Tata Motors PV working on boosting demand in global market
* Maruti Suzuki to recall 39,506 units of Grand Vitara made in Dec 9-Apr 29
* JLR output still not up to speed, Q3 will be weak for UK ops: Tata Motors PV
* Tata Motors PV cuts JLR FY26 EBIT margin guidance to 0-2% from 5-7% earlier
* Earnings Review:Tata Motors PV posts loss from continuing ops on JLR shutdown
* Minda Corp Group CFO Vinod Raheja resigns; last working day Nov 30
* Data Alert:Oct 2-wheeler despatches up 2%, PV sales up on SUV strength - SIAM
 

Following are the resistance and support levels for key automobile stocks for next week, as per calculations based on their prices on the National Stock Exchange:

End

Reported by Gopika Balasubramanium

Edited by Rajeev Pai

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