Auto Stocks Outlook for the week – 10 to 14.07.2017
Auto Stocks Outlook for the week – 10 to 14.07.2017
( www.rupeedesk.in )
The shares of most automobile companies are expected to rise next week on the back of a positive
market sentiment after the implementation of goods and services tax. The market has reacted well
to the roll-out of GST regime. Other than some issues related to hybrids, overall sentiment is
positive. In addition to this, July has been traditionally a strong month for markets. Automobile companies across the segments revised prices after Jul 1 and transferred the benefits of lower tax under GST regime to the customers. Tata Motors Ltd slashed prices by 3,300-217,000 rupees, boosting expectations of a rise in sales from this month onwards. India's largest passenger carmaker, Maruti Suzuki India Ltd, also reduced the prices of all its models by up to 3%. However, owing to a sharp increase in the combined tax rate for hybrid vehicles, the company raised the prices of Ciaz and Ertiga hybrid models. The company's sales grew 7.6% on year to 106,394 units in June. Good monsoon has also raised the growth prospects for the company, whose nearly one-third sales
depend on the rural markets. In addition to a robust monsoon, reduction in goods and services tax
rate for tractor parts to 18% from 28% is also likely to help the case of tractor makers like Mahindra
& Mahindra Ltd. The country's largest two-wheeler manufacturer, Hero MotoCorp Ltd, is also expected to receive benefits of the strong monsoon. Hero is poised to clock 10% volume CAGR over the next two years given the improved rural sentiments; planned new launches with in house R&D and aggressive tapping of export markets.
Source : Cogencis Information Services Ltd.
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Auto Stocks Outlook for the week – 10 to 14.07.2017
( www.rupeedesk.in )
The shares of most automobile companies are expected to rise next week on the back of a positive
market sentiment after the implementation of goods and services tax. The market has reacted well
to the roll-out of GST regime. Other than some issues related to hybrids, overall sentiment is
positive. In addition to this, July has been traditionally a strong month for markets. Automobile companies across the segments revised prices after Jul 1 and transferred the benefits of lower tax under GST regime to the customers. Tata Motors Ltd slashed prices by 3,300-217,000 rupees, boosting expectations of a rise in sales from this month onwards. India's largest passenger carmaker, Maruti Suzuki India Ltd, also reduced the prices of all its models by up to 3%. However, owing to a sharp increase in the combined tax rate for hybrid vehicles, the company raised the prices of Ciaz and Ertiga hybrid models. The company's sales grew 7.6% on year to 106,394 units in June. Good monsoon has also raised the growth prospects for the company, whose nearly one-third sales
depend on the rural markets. In addition to a robust monsoon, reduction in goods and services tax
rate for tractor parts to 18% from 28% is also likely to help the case of tractor makers like Mahindra
& Mahindra Ltd. The country's largest two-wheeler manufacturer, Hero MotoCorp Ltd, is also expected to receive benefits of the strong monsoon. Hero is poised to clock 10% volume CAGR over the next two years given the improved rural sentiments; planned new launches with in house R&D and aggressive tapping of export markets.
Source : Cogencis Information Services Ltd.
