Satish Ramanathan, Director & Head Equities, Sundaram Mutual in an interview with ET Now talks about auto stocks.
What about auto? Is the good time gone or are better days yet to come?
Auto is a secular story, we need to bear in mind, be it two wheelers or four wheelers. The recent census data suggests that this is a decadal story rather than a one-year or a two-year story while volume momentum may drop from time to time because of seasonal or because of base effects, the fact is that India will grow as a car market.
We have seen what has happened in China. It will continue to grow in the two wheeler space as well, though albeit a little slower than what we see in the car market, so auto as a consumer durable is okay. There may be margin pressures due to input costs, there may be royalty pressures. These are company specific issues but on a sectoral basis, I would still look at auto very seriously and keep a presence in our portfolio.
What about auto? Is the good time gone or are better days yet to come?
Auto is a secular story, we need to bear in mind, be it two wheelers or four wheelers. The recent census data suggests that this is a decadal story rather than a one-year or a two-year story while volume momentum may drop from time to time because of seasonal or because of base effects, the fact is that India will grow as a car market.
We have seen what has happened in China. It will continue to grow in the two wheeler space as well, though albeit a little slower than what we see in the car market, so auto as a consumer durable is okay. There may be margin pressures due to input costs, there may be royalty pressures. These are company specific issues but on a sectoral basis, I would still look at auto very seriously and keep a presence in our portfolio.
