Markets
Speeding ahead: Auto sector insights by Raja Venkatraman–6 January
Summary
- Here are three auto stocks to buy as recommended by Raja Venkatraman of NeoTrader for Monday, 6 January
The Indian auto sector has showcased an outstanding performance in 2024. With a record-breaking 26.1 million units sold, marking a 9% year-on-year growth, the sector's resilience and robust demand across various segments have brought it into the limelight.
This resurgence is poised to capture the attention of traders and investors in the coming weeks. While the sudden revival has piqued interest in the trading and investing community once again, the auto sector's relative strength and its potential to drive the Nifty higher looks promising yet again. With this situation now unfolding, the sector becomes a key driver of market momentum.
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Here are some notable highlights of the sector:
Record-breaking sales: The Indian auto industry achieved an all-time high in sales, surpassing pre-pandemic levels. This milestone was driven by strong demand in both the passenger and commercial vehicle segments.
Electric vehicle surge: EV sales soared to 1.95 million units in 2024, up from 1.5 million units in 2023, pushing EV market penetration to 7.5%.
Consistent demand: Two-wheelers and passenger vehicles saw steady demand, while commercial vehicles gained traction due to increased infrastructure activities.
Green mobility push: The push for green mobility, government incentives, and the easing of supply chain issues have further fuelled the sector's growth.
With such promising developments, the Indian auto sector is set to continue its upward trajectory, driving both market performance and investor interest.
Also Read: Electric journey helps Tata Motors, Mahindra become first to win auto PLI
Three stocks from auto sector to buy, recommended by NeoTrader’s Raja Venkatraman:
•TVS Motor: Buy above ₹2,490 , stop ₹2,410, target ₹2,750
India is one of the largest exporters of two-wheelers, with its major export destinations being developing or under-developing countries. Post entering the EV space the sharp upside seen in the demand for this stock. The strong showing in December highlighted the possibility of a revival in this counter. As prices look to find support at current levels some buying opportunities in this counter.
• Tata Motors: Buy at ₹791, stop ₹770, target ₹880
One of the leading automobile manufacturers witnessed sharp sell off since last 4 months which saw prices drop by nearly 40%. While broader market are making heavy weather to revive this autol counter is forming rounding pattern and is looking set for some upside thus making it a buy opportunity. Further evidence is presenting itself in the form of rising Opening Interest, suggesting that some shorts may be building up as there is an onset of some bearishness in this counter.
Also Read: Mahindra closes in on Tata Motors as EV sales falter
• Swaraj Engines: Buy at ₹3150, stop ₹3050 target ₹3500
Swaraj Engines manufactures diesel engines for Swaraj tractors , part of the Mahindra and Mahindra group. The last six months the stock been finding some strong demand at support levels around 2900. The recent rebound from the supports see V shaped recovery in the last few days. As possibility of some short-term investing play is emerging one can consider this stock.
Raja Venkatraman is co-founder, NeoTrader.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.
