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Informist, Friday, Jan. 16, 2026

NEW DELHI – Shares of automobile companies are expected to continue their negative momentum next week after the Nifty Auto index broke below its 20-day and 50-day simple moving average this week, analysts said. Friday, the sectoral index closed in the red for the second consecutive week. In the near term, the overall bias is cautious to negative, analysts said.

Friday, Nifty Auto closed 0.5% lower at 27596.25. For the week, the index fell 1.8%, underperforming the benchmark Nifty 50 index, which closed marginally higher. "The Auto index has witnessed a complete retracement of its recent short-term run-up, indicating loss of bullish momentum," said Vatsal Bhuva, technical and derivatives analyst at LKP Securities. Bhuva said the index is currently looking weak structurally as well, based on technical indicators.

"A breakdown in the RSI (relative strength index) rising trendline confirms increasing bearish pressure in the near term. Immediate support for the index is placed near the 27,500 levels; a decisive break below this zone could open the doors for a deeper correction towards the 100-day SMA placed near 27,200 levels," Bhuva said.

Out of the 15 stocks in the Nifty Auto index, 13 closed the week in the red. Auto parts maker Uno Minda Ltd. was the biggest laggard, falling 5.3% during the week. Sona BLW Precision Forgings Ltd. and Bharat Forge Ltd. were the outliers. 

The automobile industry has reported robust sales growth in recent months, mainly due to the cut in goods and services tax, which reduced vehicle prices. Industry experts expect a sales growth of 6% for passenger vehicles in 2025-26 (Apr-Mar), 7% for two-wheelers, and 5% for commercial vehicles. 

However, these estimates are conservative, Motilal Oswal said in a report. "We expect the positive growth momentum to be sustained across segments over the next three quarters, and subsequently, the growth is likely to taper off over a relatively high second half of the current fiscal. 

For the December quarter, automobile and ancillary companies in the Nifty 200 are expected to collectively report a 14% profit contraction on year and a 6% revenue growth on year, according to the average of estimates available with Informist.

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

End

Reported by Anand JC

Edited by Saji George Titus

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