Maruti Suzuki, TaMo to Ashok Leyland: Why auto stocks are in action today?
Stock market today: Ahead of monthly auto sales numbers for the month of July 2023, auto stocks are in action today. Auto majors Maruti Suzuki, Ashok Leyland, Tata Motors, Hero MotoCorp, Escorts Kubota, Force Motors, etc. are trading in green territory. According to stock market experts, auto sales starts moving upward from the second quarter and July being the first month of Q2FY24, market is expecting better sales numbers from majority of the auto majors. However, they said that numbers may rise in single digit on sequential basis due to higher base size, but in YoY-terms, market is expecting double digit growth in monthly auto sales.
Auto stocks in focus
On why auto stocks are in uptrend, Anuj Gupta, Vice President — Research at IIFL Securities said, “Auto stocks are attracting buying interest today because monthly auto sales are expected this week and market is expecting positive auto sale numbers for the month of July. As the economy is looking in sound position, auto companies are expected to deliver better quarterly numbers and hence their monthly sales is expected to spike in upcoming months.”
Explaining as to what kind of monthly auto sales, market is expecting from various auto companies, Avinash Gorakshkar, Head of Research at Profitmart Securities said, “Market is expecting better monthly sales from auto companies in two-wheeler, private car and commercial vehicles segment but from the market leaders in respective segments. Hence, one can expect better sales numbers in two wheeler segment by Hero MotoCorp, Bajaj Auto and TVS Motor. Tata Motors and Mahindra & Mahindra (M&M) may give better numbers in private cars and commercial vehicle segment where Ashok Leyland may give better numbers in commercial car sales.”
Avinash Gorakshkar said that these companies may outperform their respective peers if they mange to give monthly sales data as expected by the markets.
Stocks to buy today
Avinash Gorakshkar of Profitmart said that two wheeler segment has more volume and hence one should look at buying Hero MotoCorp, Bajaj Auto and TVS Motor. However, he advised medium to long term investors to look at Ashok Leyland, M&M and Tata Motors as these stocks are expected to remain an ideal ‘buy on dips’ stocks for long term investors in auto segment.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decision.
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Updated: 31 Jul 2023, 11:41 AM IST
