The Wheels are Turning: Auto Sector Sees Major Gains

Indian auto stocks surged on January 2, 2025, fuelled by impressive December sales numbers, which propelled the Nifty Auto index to its highest daily gain in six months.

◉ Key Players

1. Eicher Motors EICHERMOT

● Surged 7%, with December sales up 25% YoY to 79,466 units, and exports rising 90% YoY.

2. Ashok Leyland ASHOKLEY

● Rose 5%, with December sales exceeding estimates, up 5% YoY, and Medium and Heavy Commercial Vehicles sales up 8% YoY.

3. Maruti Suzuki India MARUTI

● Extended gains for the second straight day, rallying 5%, driven by strong December car sales and bullish management commentary.

4. Mahindra & Mahindra M&M

● Up over 3% for the second consecutive day, with December SUV sales jumping 18% YoY to 41,424 units, driven by strong demand.

◉ Overall Outlook

The Indian automotive market is poised for continued growth, driven by a resilient economy and robust consumer demand. Potential interest rate cuts are expected to further fuel this growth, making vehicle financing more accessible and affordable for consumers. As a result, the road ahead looks promising for FY26, with expectations of sustained growth and increased sales in the automotive sector.