Business Daily from THE HINDU group of publications
Thursday, Sep 20, 2007
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Business Daily from THE HINDU group of publications Thursday, Sep 20, 2007 ePaper |
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Two/Three Wheelers Markets - Stocks Mayur N. Shah Mumbai, Sept. 19 The US Fed Reserve reduced the benchmark funds target rate by 50 basis points to 4.75 per cent (5.25 per cent) on Tuesday. In anticipation that the Reserve Bank of India will follow suit, an adverse effect occurred on the auto scrips traded today on the BSE, especially for all two-wheeler companies. Two-wheeler companies witnessed the maximum rise in their respective scrips. Bajaj Auto was the highest gainer by the end of the day, at Rs 2,512.40 (4.65 per cent), followed by Hero Honda at Rs 700.35 (3.90 per cent) and TVS Motor Company at Rs 70.45 (0.71 per cent). Earlier, due to the prevailing interest rate hike, the two-wheeler industry was deeply impacted with low sales volume. Bajaj Auto sales volume dropped by six per cent to 170,203 units and Hero Honda had marginal growth of 12 per cent to 240,785 units, while TVS Motor Company saw sales volume drop 24 per cent to 102,734 units for August 2007 against the corresponding previous period. This slowdown has been witnessed by the industry for some months now. Analysts said that the market expects the RBI to reduce the interest rate similarly and this is likely to have a direct impact to the two industries – auto and real estate. However, senior bank officials said that the RBI will not cut interest rates because there is no ample liquidity in the system. Besides, oil prices are very high and they will continue to be a pressure on inflation. More Stories on : Two/Three Wheelers | Stocks
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