NEW DELHI: Auto shares were trading in the red in Tuesday’s morning session after passenger car sales slipped by double digits for the third straight month in June as buyers continued to be put off by higher interest costs following the nonbank lending crisis and by rising automobile prices.
“The end of election uncertainty in May did not revive Motown’s spirits and the numbers could increase pressure on the Narendra Modi-led NDA government to open the purse strings in this week’s budget to spur lending and growth. Finance minister Nirmala Sitharaman will present her first budget and the Modi government’s seventh on Friday amid a sharp consumption slowdown,” ET reported.
The motor industry estimates that passenger vehicle sales fell by about 19 per cent to 222,000 units in June, the third straight month of double-digit declines. Vehicle sales had fallen 17 per cent in April and 20.5 per cent in May. Market leaders Maruti Suzuki and Hyundai Motor India led the drop, with wholesale volumes declining by 17 per cent to 111,014 units and by 7.3 per cent to 42,007 units, respectively,” the report added.
“The elections got over towards the end of May. Demand cannot revive overnight. The budget, new policies are yet to be announced by the government,” Maruti Suzuki chairman RC Bhargava told ET.
“That said, wholesale numbers do not reflect the demand on ground. If we look at retail data on a month-on-month basis, it will give a better picture of consumer sentiments,” he added.
Shares of Tata Motors (down 1.90 per cent), Hero MotoCorpNSE 0.03 % (down 1.28 per cent) , Bharat ForgeNSE 0.75 % (down 1.11 per cent) and TVS Motor Company (down 1.11 per cent) were the top losers in the index.
Bajaj Auto (down 1.03 per cent) , Eicher Motors (down 0.74 per cent) , Exide Industries (down 0.55 per cent) and Apollo Tyres (down 0.37 per cent) too were trading with losses.
The Nifty Auto index was trading 0.37 per cent down at 7999.50 around 09:50 am.
Benchmark NSE Nifty50 index was up 5.60 points at 11,871.20 while the BSE Sensex was up 19.26 points at 39,705.76.
Among the 50 stocks in the Nifty index, 21 were trading in the green, while 29 were in the red.
Shares of YES Bank, Adani Power, Vodafone Idea, Dish TV India, ZEEL, Adani Green Energy, Adani Enterprises, Tata Motors, JSPL and PNB were among the most traded shares on the NSE.