Hero MotoCorp to TVS, two-wheeler stocks skid as margin pressure weighs

Situation similar to FY2004-07, when volume growth was strong but profitability slid

Share prices of two-wheeler makers were among the biggest losers in trade on Monday, shedding up to six per cent on worries that aggressive pricing at a time of commodity inflation would squeeze margins.

Hero MotoCorp fell 6.2 per cent, Bajaj Auto by 5.3 per cent and TVS Motor by 4.2 per cent. Including Monday, the three shares are down by six to 14 per cent over the past week.

In the case of Bajaj Auto, the trigger for the sharp price correction has been a sudden change in strategy. It is now focusing on gaining of market share in the home