Rally in auto component stocks will continue: Neeraj Deewan, Quantum Securities

In a chat with ET Now, Neeraj Deewan, Director, Quantum Securities, shares his views on the auto component space.

ET Now: A basket that has done extremely well the last few months and even the last few days is auto components. One of the stocks that you had mentioned earlier was Ahmednagar Forgings. What do you feel about the rally in these stocks? Is there more to come in auto components in general, or in any of the auto components stocks in particular?

Neeraj Deewan: This rally will continue. There will be periods of consolidation. Even the Amtek Group of which Ahmednagar is part, is doing quite well. Motherson Sumi, which is one of our other stock picks, is also doing very well. So this rally will continue.

There is improvement for stocks like Motherson Sumi for the European companies for European part of the business. In India there is improvement too. They are adding more customers. They have gone through a capacity expansion phase. Most of them have capcities now.

So, whenever new order flow comes, they will improve even more. Sales too will go up. There is another indication that there will be more demand coming from OEMs. So, this rally will continue. There is still a lot of scope as far as the auto component companies are concerned.