 "BUDGET")
Auto stocks, including two-wheelers, have witnessed a phenomenal rally since the start of FY24. The share price of Bajaj Auto has seen a sharp appreciation of over 131 per cent in the last 13-odd months. Similarly, TVS Motor stock price has rallied by 86 per cent.
The stock price of Aether Industries, however, has witnessed a decline of around 10.7 per cent in the same period. In comparison, the benchmark NSE Nifty 50 has gained 22.2 per cent, while the Auto index has rallied 77.5 per cent.
On Monday, Ola Electric, the market leader in e-scooters announced a sharp Rs 5,000 to Rs 10,000 price cut in entry-level e-scooter S1 X across variants, bringing it at par with conventional scooters. Ola Electric S1 X was launched in February 2024 in the price band of Rs 79,999 to Rs 1,09,999 across three variants.
Analysts believe that Ola being a market leader has cut prices, hence others may have to follow suit. However, they expect a positive impact of the price cut on sales.
Kranthi Bathini Director of Equity WealthMills Securities says a price cut will have a positive impact on the volume of e-scooters sales in India, and thus might not impact revenues for these two-wheeler makers.
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Further, Bajaj Auto is scheduled to announce its earnings on Thursday. Kranthi Bathini expects the auto major to report healthy earnings, and positive outlook going ahead owing to anticipated rural demand in an election year.
Meanwhile, here's a quick check on the likely trend for Bajaj Auto stock price, Aether and TVS Motor in the near-term.
Bajaj Auto
Current Price: Rs 8,985
Downside Risk: 5.4%
Key Support: Rs 8,935
Bajaj Auto stock price has been taking support around its 20-DMA (Daily Moving Average) for the last few trading sessions. The 20-DMA presently stands at Rs 8,935. However, given the negative divergence in key momentum oscillators on the daily chart, Bajaj Auto stock may soon break below its 20-DMA. CLICK HERE FOR THE CHART
In such a case, the stock price of Bajaj Auto can slide to test the super trend line support at Rs 8,500-odd levels, shows the daily chart.
On the other hand, in case, the 20-DMA support holds, Bajaj Auto share price can swiftly move back towards the anticipated higher-end of the trading band at Rs 9,400 levels.
TVS Motor
Current Price: Rs 1,987
Downside Risk: 14.4%
Support: Rs 1,890
Resistance: Rs 2,030; Rs 2,077; Rs 2,108
TVS Motor stock is currently exhibiting a negative bias on the daily time-frame, with the stock price trading below its short-term moving averages. Further, the 20-DMA now at Rs 2,077 has slipped below the 50-DMA at Rs 2,108 and seems on course to dip below the 100-DMA, which stands at Rs 2,030. CLICK HERE FOR THE CHART
Hence, the near-term bias is expected to remain negative as long as the TVS Motor stock trades below these hurdles. On the downside, the stock may seek support around Rs 1,890 levels, below which there exists a risk of a sharp fall to Rs 1,700-odd levels.
Aether Industries
Current Price: Rs 840
Bias: Range-bound likely
Likely Range: Rs 780 - Rs 920
Aether Industries stock is presently testing resistance around its 20-WMA (Weekly Moving Average) at Rs 850-odd levels. Aether stock has failed to conquer the 20-WMA hurdle since the breakdown in September 2023.
In case, the stock price of Aether Industries once again fails to overcome this hurdle, it can drift back to Rs 780-odd levels. In case, of an upside breakout, the stock can potentially rally to Rs 920-odd levels. Overall, the weekly chart suggests a likely range bound trading below Rs 780 - Rs 920 for the Aether Industries stock. CLICK HERE FOR THE CHART
