Auto stocks have had a phenomenal run from the March lows, with Ashok Leyland being the strongest performer. HDFC Securities’ Aditya Makharia, however, points that although auto stocks have doubled from the lows, the auto index is still 20-25 percent lower from the highs of January 2018.
“While the broader market is at an all-time high, the Indian auto index is yet lower. One of the key reasons for the same is that if you look at volumes, volumes are not back up where they were in 2018. There is still some time for us to catch up to those volume levels which we had seen 2 years ago,” Makharia, Senior Analyst – Automobiles at HDFC Securities told CNBC-TV18 in an interview on Tuesday.
Makharia said that he is positive on stocks like Maruti Suzuki and Hero MotoCorp.
“If you look at stocks which have demand momentum, passenger vehicles definitely comes to light. So therefore you can look at OEMs such as Maruti Suzuki. The Indian OEMs have become a lot more progressive even in terms of technology. So another company we like to this extent is Hero MotoCorp,” he said.