Auto Stocks Outlook for the Week – 15 TO 19.12.2014
( www.rupeedesk.in )
Stocks of major automobile companies are seen under
pressure next week as broader markets are expected to fall. The automobile companies were top
performers over the past six months ever since the new government at the Centre assumed
office. These stocks are a good mediumterm bet.
Stocks of Tata Motors are seen declining, as its UK-based
subsidiary Jaguar Land Rover Automotive has reported a 2% decline in global retail
sales in November at 36,621 vehicles, impacted by a sharp decline in sales in North America. The
automaker's retail sales under the Land Rover brand fell 2% on year to 30,611 units, while
those under the Jaguar brand fell 4% to 6,010 units.
JLR's sales in North America, particularly in the US, have
fallen of late due to what the company has termed as production scheduling issues. Sales in North
America fell 17% on year during the month. However, its retail sales in other markets grew,
with sales in China up 10% and those in the Asia-Pacific and the UK growing 5% each. JLR
contributes 100% of Tata Motors' consolidated net profit and around 85-90% of its
consolidated net sales.
Hero MotoCorp's stocks are expected to be the pick of
automotive stocks next week and in the medium term mainly due to its export focus and good
potential for domestic sales.
