Shares of automobiles companies are under pressure on the bourses with the most of the frontline stocks from the sector are trading lower by 1-4% on the Bombay Stock Exchange (BSE).
The BSE, Auto index, the largest loser among the sectoral indices is down over 3% at 9,127 points, compared to 1.6% drop in the benchmark index at 1107 hours. In past one month, the auto index is underperforming the market by falling 15%, against 9% decline in Sensex
“The impact of 5% excise duty increase in the latest Union Budget and 3%-5% drop in truck freight rates in April’12 turned out to be doubly whammy for truck sales as volumes plunge by 17.9% for M&HCV goods segment in April’12 as against the same period last year, while multi-axle truck down by 27.7% and tractor trailer sales slide by 22.9%,” according to analyst at Prabhudas Liladher.
Tata Motors has dipped 5% at Rs 258, slipping 11% in past three trading sessions, after the company said its global sales remained flat in April at 87,377 units over the same period last year. India's largest automobile company had sold 87,114 units in April 2011.
Maruti Suzuki is trading down 4% at Rs 1,157, its lowest level since January 27 on the BSE. According to media reports, India’s largest car maker have downscaled its proposed investment plans in Mehasana, Gujarat.
Bajaj Auto, Hero MotoCorp and Mahindra and Mahindra are down by 2-3% on the BSE.