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Summary of Contents
SHAREKHAN
SPECIAL
Auto earnings
preview
Q1FY2007 has been a strong quarter for the automobile
sector. Bajaj Auto's motorcycle sales grew by 34.5%, Maruti's car
sales grew by 19% and Tata Motors' commercial vehicle sales grew by
64% (on a low base of Q1FY2006 due to the implementation of the new
emission norms).
The volume growth in the
quarter should lead to margin expansion, thereby mitigating the
impact of the rising costs to some extent. Most of the vehicle
companies are planning to raise the prices by 2-3% from Q2FY2007
onwards to offset the impact of the cost increases.
We expect Ashok Leyland, Bajaj
Auto and Maruti Udyog to be among the leaders in the sector for this
quarter. | 
