Shares of automobiles companies were in focus with the S&P BSE Auto index surging an over 500 points led by rally in auto, auto ancillaries and tyre stocks.
Tata Motors, Bharat Forge, Motherson Sumi Systems, Bosch, Cummins India, MRF, Bajaj Auto, Maruti Suzuki India, Mahindra & Mahindra (M&M) and Hero MotoCorp from the auto index were up between 2% and 5% on the BSE.
At 02:16 pm; the S&P BSE Auto index, the largest gainer among sectoral indices in point terms, was up 515 points or 2.6% at 20,546 as compared to 1.8% rise in the benchmark S&P BSE Sensex.
Bharat Forge rallied 5.5% to Rs 966, extending its past three days 5% gain on the BSE, after the company said it completed acquisition of Walker Forge Tennessee LLC and PMT Holdings Inc., USA for a total consideration of $14 million. The acquisition was done through its wholly-owned subsidiary, Bharat Forge America Inc., USA.
Tata Motors was up 4.4% to Rs 465 on the BSE in intra-day after the company said Jaguar Land Rover (JLR), the UK's leading manufacturer of premium luxury vehicles, reported its best ever November retail sales of 47,588 vehicles, up 2% compared to November 2015.
Jaguar recorded its best November ever, with retail sales reaching 14,613 vehicles, up 83% compared to November last year, and driven by continuing strong sales of the new XF and the F-PACE.
According to Nirmal Bang Institutional Equities, “Recent dealer checks and management commentary indicates improvement in enquires/footfalls at showrooms after the initial sharp fall post announcement of demonetisation, but enquiries are not close to their normal level.
Also, December is considered to be a weak month for vehicle sales and therefore we expect sales for the month to worsen compared to November 2016.
Automobile sales in November 2016 were adversely impacted in case of most companies because of demonetisation and a high base. Also, the festive season this year came a month earlier compared to last year which resulted in an unfavourable high base for automobile companies, the brokerage firm said in a recent report.