We are bullish on auto space: Sunil Shah

ET Now spoke to Sunil Shah, Director Equities, Indsec Securities and Finance on his views on the auto sector.

Macquire is putting a sell on both Hero Honda and Bajaj Auto. Are you tracking the auto pack? How are the two-wheelers looking at this point?


Sunil Shah: The price run up has already come through in most of the two-wheeler companies like Hero Honda and Bajaj Auto but we still think that there are huge amounts of upsides left.

The price round up is there but the kind of doles that have been announced in this budget largely towards the rural side of the Indian economy that will propel the demand for many of the two-wheelers even in the near future.

Again the excise rollback which has happened will apply from April onwards, so March month will certainly see huge amount of sales off take which will happen in the entire automobile space.

So we are bullish on that space in the near term for sure, whether it is just the two-wheeler players or the CV manufacturers or as well as the car manufacturers.

I think I need to mention that over the last five years if you look at the data, the market share of the rural space in the two-wheeler sales has improved from 25% to 35%. This trend is still likely to continue in the near future so we think the two-wheeler space is a good investment horizon over 6 to 12 months and one can certainly be stay invested in that space.