Enter two wheelers stocks at current prices: Rajan Malik

In a chat with ET Now, Rajan Malik, Head Equities, Private Client Group, MF Global shares his views on auto stocks.

ET Now: What’s your own assessment of auto?

Rajan Malik: The auto sector comes from a very large growth base last year. This is one sector that gets impacted the most by the hike in commodity prices and it is one of the most interest rate sensitive sectors. So it has had a lot of headwinds going into the thing. However, prices have been falling distinctly in the sector. We believe that based on the domestic demand story, you should start nibbling on the two wheelers if not the four wheelers now. If the broader markets were to go down south, maybe even the four wheelers would become a bet. If you are playing the consumption story, autos will remain a major point to play with but they have got a lot of headwinds going into the past. With oil coming down, you have to see what would happen to the interest rates and maybe inflation down. So it is a broader game that would benefit the sector going forward. So given the domestic demand story, this is one sector you should start nibbling in at these prices, two wheelers should be a priority and then the four wheelers.