Automobile shares geared up today on buying following renewed hopes that the sector is in the recovery mode, with almost all auto companies registering higher sales in December, dealers said.
Among two-wheeler stocks on the Bombay Stock Exchange, Kinetic Motor was up 18.75 per cent at Rs 39.90, LML up 6.18 per cent at Rs 18.05, Bajaj Auto up 4.99 per cent at Rs 444.55 and TVS Motor Company up 4.94 per cent to Rs 232.70. Tractor major Mahindra & Mahindra ended up 9.16 per cent at Rs 107.80, Escorts up 5.85 per cent at Rs 54.30 and Telco was up 3.89 per cent at Rs 130.90.
Auto shares have been bullish over the past few months on hopes that the sector is on a recovery path. Shares of auto major Telco have jumped over 100 per cent from a mid-September 2001 low of Rs 63.45. Mahindra & Mahindra, too, jumped over 100 per cent from its late September 2001 low of Rs 51.45.
On the other hand, a sustained rise in motorcycle sales has boosted the two-wheeler segment. Bajaj Auto has reinforced the optimism in this segment with buoyant Q3 results.
The recovery in the auto sector is evident in the sales figures of the commercial vehicles (M&HVC) segment which have climbed 2 per cent year on year in the April-December 2001 period compared to a 4 per cent year on year fall in April-September 2001.
The commercial vehicles sector is said to reflect the pulse of the auto sector and a recovery in LCVs should follow the recovery in M&HVCs, dealers said.
