Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Money / Auto stocks plunge to 8-month low
BackBack

Auto stocks plunge to 8-month low

Auto stocks plunge to 8-month low

Premium

Mumbai: The Bombay Stock Exchange (BSE) auto index had its biggest fall in more than eight months on Thursday as investors locked in profits after a recent rally, dealers said.

Tata Motors, the country’s biggest cars and trucks maker, also fell 6.93%, its biggest drop since 30 June, leading its peers lower. The auto index lost 4.43%, the most since 1 December 2008. The auto sector has “had a dry season from October to March and since last 3-4 months it has picked up....I think the growth will taper off somewhere," said Ambareesh Baliga, vice president, Karvy Stock Broking.

“Next 3-4 months there can be a dip in sales," he added.

Automobile firms reported better-than-expected profits in the April-June quarter, helped by lower input costs, while their July sales soared on new launches and easier availability of finance, spurring institutional buying in their stocks.

The auto index has surged 64% in the past three months, more than double that of the Sensex which gained 31%.

Tata Motors shares rose 44% since 30 June, gaining pace after it unexpectedly reported a profit for the June-quarter, even though its Jaguar-Land Rover unit posted a loss.

“Tata Motors stock has had quite a bit of run up in comparison to its net worth.... it has gone up due to its Indian operations," Baliga said, adding that auto shares are now overvalued.

Futures in auto shares also traded at a discount to their spot prices, prompting traders to sell in the cash market, said D.D. Sharma, vice-president, Anand Rathi Securities.

Shares in utility vehicles and tractor maker Mahindra & Mahindra Ltd fell 4.14% to Rs881.90, while the BSE 30-share barometer fell 2.45% to 15,514.03.

Leading car maker Maruti Suzuki shares plunged 5.34% to Rs1,364.00 in the Mumbai market.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 06 Aug 2009, 08:11 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App