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Auto Stocks Outlook for the week – 06 to 10.03.2017

Auto Stocks Outlook for the week – 06 to 10.03.2017



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Auto Stocks Outlook for the week – 06 to 10.03.2017
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The stocks of most automobile companies are seen trading within a close range next week, with twowheeler companies in focus. The stocks of Hero MotoCorp Ltd and Bajaj Auto Ltd are looking strong on the charts for next week. In the monthly sales figures for February, two-wheeler companies showed signs of recovery post demonetisation blues on account of improved demand and better cash availability. India's largest twowheeler manufacturer, Hero MotoCorp Ltd, posted a 4.8% on-year decline in its monthly unit sales in February as against a 13.5% on-year fall in January. Bajaj Auto Ltd, the second largest two-wheeler maker, also showed an improved picture, with sales of motorcycles rising 4% on year in February to  244,958 units, against a 16% on-year fall in January. -TVS Motor's growth is expected to outperform the industry in the long term, both in terms of volume and revenue, as the company is seen better aligned to emerging consumer trends in domestic twowheeler space. -Eicher Motors Ltd, market leader in the premium motorcycle category, is expected to remain the biggest beneficiary of the emerging trend of leisure transportation, the report added. The Domestic monthly sales of Tata Motors Ltd and Ashok Leyland Ltd in February showed a mixed picture for commercial vehicles as companies saw less pre-buying than expected, ahead of implementation of Bharat Stage-IV emission norms with effect from Apr 1. Most commercial vehicle makers had expected more pre-buying of their Bharat Stage-III compliant vehicles before Apr 1, as these vehicles would not be manufactured after Apr 1 and Bharat Stage-IV compliant vehicles will also be more expensive. However, volumes of medium and heavy commercial vehicles are expected to recover in March as with the short-term demonetisation impact wearing off, pre-buying of Bharat Stage-III compliant vehicles and infrastructure activity-led demand would also pick up.