rupeedesk.in
Stocks of most automobile companies are expected to trade with a negative bias next week as the rupees continues its downfall against dollar making imports of components costlier. The rupee has depreciated around 10% against the US dollar since Jan 1. However, for automakers with good exports, the rupee fall has been beneficial. Bajaj Auto Ltd stocks have seen upside movement on the Indian currency's fall. Companies such as Maruti Suzuki India Ltd and Hero MotoCorp Ltd would not incur heavy losses on currency movement as the Japanese yen has depreciated along with the rupee. Maruti Suzuki, Hero MotoCorp, both import parts from Japan.We are hoping for a revival of the rupee, but in the current scenario it doesn't look like it will happen very soon. Apart from the rupee fall, the general environment within the automobile industry in India does not look very positive for the counters of auto companies. Ford India, an unlisted company, Wednesday launched its EcoSport sports utility vehicle in India at a stunning starting price of 5, 59,000 rupees, a move that is seen affecting the counters of its competitors negatively in the near future. The EcoSport would compete with Mahindra & Mahindra Ltd's Quanto, and Maruti Suzuki India Ltd's Ertiga among the companies listed on domestic stock exchanges. Automobile manufactures are scheduled to detail their monthly sales figures for the month for June on Monday; something that analysts pointed out wasn't going to be "a sign of joy" by any means. Domestic vehicle sales are down on account of slowing economic growth, damp consumer sentiment, high interest rates and fuel costs. These factors do not look to be changing over the medium term, and are likely to keep the pressure on stock prices of automobile companies.
Stocks of most automobile companies are expected to trade with a negative bias next week as the rupees continues its downfall against dollar making imports of components costlier. The rupee has depreciated around 10% against the US dollar since Jan 1. However, for automakers with good exports, the rupee fall has been beneficial. Bajaj Auto Ltd stocks have seen upside movement on the Indian currency's fall. Companies such as Maruti Suzuki India Ltd and Hero MotoCorp Ltd would not incur heavy losses on currency movement as the Japanese yen has depreciated along with the rupee. Maruti Suzuki, Hero MotoCorp, both import parts from Japan.We are hoping for a revival of the rupee, but in the current scenario it doesn't look like it will happen very soon. Apart from the rupee fall, the general environment within the automobile industry in India does not look very positive for the counters of auto companies. Ford India, an unlisted company, Wednesday launched its EcoSport sports utility vehicle in India at a stunning starting price of 5, 59,000 rupees, a move that is seen affecting the counters of its competitors negatively in the near future. The EcoSport would compete with Mahindra & Mahindra Ltd's Quanto, and Maruti Suzuki India Ltd's Ertiga among the companies listed on domestic stock exchanges. Automobile manufactures are scheduled to detail their monthly sales figures for the month for June on Monday; something that analysts pointed out wasn't going to be "a sign of joy" by any means. Domestic vehicle sales are down on account of slowing economic growth, damp consumer sentiment, high interest rates and fuel costs. These factors do not look to be changing over the medium term, and are likely to keep the pressure on stock prices of automobile companies.
