Shares of seven auto companies rose by 1.33% to 4.76% at 12:25 IST on BSE after PSU OMCs cut petrol and diesel prices with effect from today, 16 November 2016.
The announcement of fortnightly fuel price revision by PSU OMCs was made after market hours yesterday, 15 November 2016.Meanwhile, the BSE Sensex was up 214.26 points, or 0.81%, to 26,518.89.
Mahindra & Mahindra (M&M) (up 2.17%), Maruti Suzuki India (up 2.65%), Eicher Motors (up 4.76%), Bajaj Auto (up 1.33%), Hero MotoCorp (up 2.84%), Tata Motors (up 1.87%) and TVS Motor Company (up 2.7%) gained. Ashok Leyland declined 0.3%. Indian vehicle purchaser is fuel price sensitive thus fall in fuel prices augurs well for the auto sector.
PSU OMCs announced reduction in selling price of petrol by Rs 1.46 per litre (excluding state levies) and reduction in selling price of diesel by Rs 1.53 per litre (excluding state levies) with effect from 16 November 2016. The current level of international product prices of petrol and diesel and rupee-dollar exchange rate warrant decrease in selling price of petrol and diesel, the impact of which is being passed on to the consumers with this price revision, Indian Oil Corporation said.
The BSE Auto index underperformed the market over the past one month till 15 November 2016, dropping 13.45% compared with the Sensex's 4.95% fall. The index also underperformed the market in past one quarter, declining 8.8% as against the Sensex's 6.56% decline.
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