Equity Alert: Auto shares down on fears of slowdown in demand

[K.Karthik Raja]

------------------------------------------------------------------------------
Equity Alert: Auto shares down on fears of slowdown in demand
MUMBAI--11:15AM--Auto shares were down up to 1% on fears of a
slowdown in
demand for vehicles following Wednesday's fuel price hike, dealers
said.
Analysts said short-term outlook for the auto sector is looking
bleak on
concerns of rising interest rates due to high inflationary pressures.
"Two-wheeler and passenger cars segment will witness slowdown in
demand
post fuel price hike. Also rising inflation is likely to fuel hike in
interest rates, which will hamper their (auto companies') business,"
Vaishali
Jajoo, analyst at Angel Broking, said.
The brokerage has a "neutral" rating on Tata Motors, Hero Honda
Motors, and
TVS Motors, while it recommends buying shares of Maruti Suzuki and
Mahindra &
Mahindra on cheaper valuations, Jajoo said.
Tata Motors, M&M, and TVS Motors fell 1% each to 537 rupees, 561
rupees,
and 35 rupees, respectively. Hero Honda was down 0.5% at 773 rupees.
M&M shares were off lows hit earlier in the session on news it had
acquired 100% stake in Engines Engineering.
Intraday support for Tata Motors and Hero Honda Motors is seen at
525
rupees and 763 rupees, respectively, a dealer said.