The automobile stocks were trading higher on Monday on the back of reasonably steady sales in February. The Nifty Auto is up as much as 1.8% and the top index gainers include Eicher Motors, M&M. Analysing the overall trend in the auto sector, Motilal Oswal highlighted that, “in PVs, we noted a sustained outperformance by both Maruti Suzuki and M&M relative to peers. Demand across segments remains weak, except for tractors, where we expect dispatches to remain positive in the near term, driven by positive farm sentiment.”
Motilal Oswal’s top automobile picks
Motilal Oswal has identified Mahindra & Mahindra and Maruti Suzuki as the top picks in the automobile sector. “Maruti Suzuki is our top pick among auto OEMs, as its upcoming new launches are expected to continue to help improve the mix and drive healthy earnings growth. We also like M&M given the upcycle in tractors and healthy growth in UVs,” stated Motilal Oswal.
Mahindra & Mahindra’s share price rose 4.3% to an intra-day high of Rs 2,695.95 after it surged past Hyundai to become the second-best-selling carmaker in February 2025. The stock was among the top gainers in the Nifty 50. Mahindra‘s domestic sales stood at 23,880 units in February, as against 20,121 units in the same month of 2024, an increase of 19%. However, the share price of M&M has fallen 4.6% in the previous five trading sessions. The stock erased 17% of investors’ wealth.
Maruto Suzuki share price rose 1% to an intra-day high of Rs 12,059.45 on Monday.
February auto sales inline with Motilal Oswal’s estimates
According to the Motilal Oswal report, PV wholesales grew 2% YoY, aligning with their expectations. “Among listed peers, Maruti Suzuki India and M&M outperformed during the month.” Maruti Suzuki’s PV volumes rose 1% YoY to 1,99,400 units despite a high base. Its domestic SUV volumes increased 6% YoY, while non-SUV volumes remained largely flat, resulting in 4% YoY growth in overall domestic volumes. Further, “M&M’s UV volumes (including pick-ups) rose 19% YoY, reflecting sustained momentum in its SUV models. In contrast, Hyundai’s domestic volumes declined 5% YoY, while exports grew 7% YoY, leading to an overall volume decline of 3% YoY to 58,700 units. Meanwhile, Tata Motors continued to underperform, with PV volumes declining 9% YoY.”
Tractor sales above Motilal Oswal’s sales estimates
Motilal Oswal further stated that,
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