Auto stocks surged up to 4 per cent on Thursday on hopes of revival in demand for personal vehicles and value buying.
TVS Motor was the biggest gainer from the pack, up 4.04 per cent to Rs 463.45. Eicher Motors added 2.91 per cent to Rs 22,384 and Mahindra & Mahindra was up 2.7 per cent to Rs 537. Nifty Auto was the biggest sectoral gainer on NSE, advancing 1.23 per cent to 8181.40.
“Auto is one sector that has seen growing interest from traders as there is hope that if there is a revival in economic growth then the demand will pick up quickly. Plus valuations are comparatively low and there is under ownership in the sector,” said Siddharth Khemka, VP – Head of Research (Retail) at Motilal Oswal Financial Services.
Recently, India’s biggest carmaker Maruti Suzuki reported an increase in its production in November by 4.33 per cent year-on-year. The company had witnessed reduced output for nine-straight months due to lower demand.
A clarity on Brexit, with Boris Johnson’s win in the UK, has also helped sentiments, especially stocks that are linked to its economy. Tata Motors, which owns Jaguar Land Rover, gained 1.72 per cent at Rs 177.70 and Motherson Sumi edged higher by 0.44 per cent to Rs 147.65.
Nifty Auto, up 3 per cent, has been among the biggest sectoral gainers in the last one week, along with Nifty Metal and Nifty IT. It has outperformed Sensex that has grown 2.7 per cent in the same period.
Source: Economic Times