A play on economic growth and transformation: 7 auto stocks from different segments with upside potential

If one looks at the history of the stock market, the rallies which are led by the transportation and auto sector are more durable rallies. Especially the ones which are led by large commercial vehicles. The reason, sales of LCV and certain other auto segments is an indication of the economic situation on the ground. Demand for large commercial vehicles would only increase when there is higher economic growth as more goods get moved from one place to another when the economy is doing well. But as the stocks have done well in the recent past, it is time to be selective at least in the near term.

In some segments like cars and two wheelers do have witnessing rising sales in festive season. But this time in case of even in these two segments, what would be more interesting to watch would be the fact how much sales the EV segment is able to get. If there is a sharp jump in EV numbers then it would mean that the final inflection point as far as the price is concerned will be higher than what has been estimated earlier. Which means early adoption. So when companies announce their sales numbers for the following months, October, November and December, it would throw a light on possible winners for next year.

India Business News: Anish Shah, the group CEO and managing director of Mahindra & Mahindra, has taken over as the president of Ficci. In an interview, Shah discusses the

As the headwind for the auto sector starts to slow and the nifty auto index continues to outperform some of the other sectoral indices, we take a look at what analysts' views are on segments and sub-segments of the auto industry. Stock Reports Plus, powered by Refinitiv, is a comprehensive research report that evaluates five key components of 4,000+ listed stocks - earnings, fundamentals, relative valuation, risk and price momentum to generate standardized scores.

Stock Market Today: Bajaj Auto, TVS, Hero MotoCorp, M&M share price gained more than 1% on Friday. Bajaj TVS, Hero reported 22-24% y-o-y growth in two-wheeler sales. M&M, Maruti, Tata Motors passenger Vehicle sales grew 12-30% y-o-y. Commercial Vehicles, Tractor however saw tepid sales growth.

Daimler India Commercial Vehicles (DICV) has reported a revenue growth of 37% and a sales growth of 25% in CY 2022 from CY21 amid supply-chain headwinds and adverse cost environment.

Textile is one of the oldest industrial sectors in India. However, right from labour issues to smaller Asian countries becoming more competitive in terms of cost of production, different segments of the textile industry have faced more headwinds than tailwinds in their history of existence. This list is drawn from Stock Reports Plus, powered by Refinitiv, with over 4,000 listed stocks along with detailed company analysis focusing on five key components - earnings, fundamentals, relative valuation, risk and price momentum.

Gone are the days, when a single company was considered a bellwether for IT sector stock. Today, whether it is a large or mid sized company, all have different focus areas and hence their quarterly results tend to differ from one another. Stock Reports Plus, powered by Refinitiv, is a comprehensive research report that evaluates five key components of 4,000+ listed stocks - earnings, fundamentals, relative valuation, risk and price momentum to generate standardized scores.

If one takes June - July 2020 as the base from where this bull run started. Amongst the first to gain were stocks like Ashok leyland, Tata motors, Eicher motors. There was good enough reason for it, all these companies get a significant part of their sales from either heavy commercial vehicles or light commercial vehicles. Sales of LCV and certain other auto segments is an indication of the economic situation on the ground. Demand for large commercial vehicles would only increase when there is higher economic growth as more goods get moved from one place to another when the economy is doing well. So it is LCV and HCV which are the lead indicators of what is in store for the economy. But behind the finished automobile product there is a huge supply chain, right from an auto ancillary unit making forgings, to a tyre maker. Rather than look at one segment it would be worthwhile to look at select stocks which form the part of the chain. The reason, when LCV will indicate good numbers, then means subsequently there would be better car and two wheeler numbers.

Maruti Suzuki India's Senior Executive Officer (Marketing and Sales) Shashank Srivastava predicts that an increase in interest rates for auto loans could impact passenger vehicle sales in India. With a record 41.08 lakh units in 2023, the auto industry is expected to grow in a single digit, with the overall economic growth of the country being a positive factor.