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Stocks of automobile companies are expected to move in a narrow range with a negative bias next week amid lack of triggers, and in the run-up to the Union Budget for 2013-14 (Apr-Mar). Finance Minister P. Chidambaram will detail the Union Budget on Feb 28. The auto industry that has been facing a slowdown in demand for over a year now has its hopes pinned on the Budget for a cut in excise duty and other measures for restoring growth in the sector. It has demanded a cut in excise duty on sub-four-mtr vehicles to 10% from existing 12% and on larger vehicles to 22% from over 25% now. Society of Indian Automobile Manufacturers has also opposed the proposed additional duty on diesel cars, which it feels will ground a segment that is at least doing well in an otherwise subdued environment. The petroleum ministry had proposed a hike in excise duty on cars run on diesel in a bid to reduce the demand for the fuel, which is highly subsidised by the government. On Feb 11, the Society of Indian Automobile Manufacturers had said the industry will miss all forecasts set for 2012-13. According to the latest forecast made in January, passenger car sales were to grow 0-1% in 2012-13.
Stocks of automobile companies are expected to move in a narrow range with a negative bias next week amid lack of triggers, and in the run-up to the Union Budget for 2013-14 (Apr-Mar). Finance Minister P. Chidambaram will detail the Union Budget on Feb 28. The auto industry that has been facing a slowdown in demand for over a year now has its hopes pinned on the Budget for a cut in excise duty and other measures for restoring growth in the sector. It has demanded a cut in excise duty on sub-four-mtr vehicles to 10% from existing 12% and on larger vehicles to 22% from over 25% now. Society of Indian Automobile Manufacturers has also opposed the proposed additional duty on diesel cars, which it feels will ground a segment that is at least doing well in an otherwise subdued environment. The petroleum ministry had proposed a hike in excise duty on cars run on diesel in a bid to reduce the demand for the fuel, which is highly subsidised by the government. On Feb 11, the Society of Indian Automobile Manufacturers had said the industry will miss all forecasts set for 2012-13. According to the latest forecast made in January, passenger car sales were to grow 0-1% in 2012-13.
