Indian Stock Market News, Equity Market and Sensex Today in India | Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

The GDP indicator on wheels
Wed, 12 May Pre-Open

If there is any number that clearly indicates the potential of India's GDP growth, it's this. It is a growth number that is purely a multiple of an economy's GDP growth. Companies from the sector sporting this growth have featured amongst the highest profit earners during the latest quarter's results. It is thus with good reason that investors keep a close eye on the auto numbers in India and China these days. That is besides those coming from the US and Europe.

Auto numbers in Asia do seem quite strong when compared to those in the West. However, it has its own set of challenges. Increasing raw material costs and inflation are some of the major problems. With China and Indian growing at a rapid pace, these countries need to make huge investments to curtail emissions. Bringing the vehicles' emission in line with global standards even over a long duration could cost billions of dollars. This would in turn strain the automakers to spend more on cleaner technologies. The challenge is even steep in an economy like India where more than 70% of the demand is for small cars. Or those that offer maximum value for money.

India recently posted its highest ever car sales figure in the decade. The auto manufacturers' association (SIAM) expects the growth to sustain. The key levers being easy availability of finance at affordable rates. While passenger car sales have grown by 40% YoY, commercial vehicles too rode a swell of investments in infrastructure. The sales of the latter grew more than 64% YoY. The key concern for SIAM now is strains on capacity.

China, the world's largest automotive market posted a 33% increase in car sales in April 2010. The China Association of Auto Manufacturers (CAAM) forecasts 10% annual growth in sales in 2010. But both Chinese and Indian car manufacturers could be up for some disappointment. This is given the unwillingness of respective central banks to let the inflation numbers go berserk. A quick uptick in interest rates could easily shave off several percentage points from the auto sales growth.

Car manufacturers in Japan, US and Europe have also seen better days in recent times. Same time last year the US auto industry was facing its worst turmoil. Behemoths like and GM and Chrysler were en-route to bankruptcy filings. But with bailouts and small cars filling in assembly lines, these car makers too are foreseeing improved profits.

Thus the global automotive industry seems to have put the economic crisis at the back of its mind now. Nonetheless, it cannot ignore the impact of GDP growth and interest rates on its growth numbers. The global economy is far from showing signs of stability. And inflation is threatening to make financing expensive. Thus it will be a long time before the industry completely recovers from its vulnerable state. The only way to remain profitable is to be proactive in aligning with future demand. Only such measures could help the players avert another crisis.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

Read the latest Market Commentary

What else is happening in the markets today? Dig in...

Equitymaster requests your view! Post a comment on "The GDP indicator on wheels". Click here!


Stock Market Updates

Sensex Ends 598 Points Lower, Nifty Settles Below 15,100-Mark; HDFC and JSW Steel Top Losers (Today's Market)

Mar 4, 2021 Closing

Indian share markets end deep in the red with the Sensex down by 598 points and the Nifty ending down by 164 points.

TORRENT POWER Share Price Up by 5%; BSE POWER Index Up 0.6% (Today's Market)

Mar 4, 2021 03:12 PM

TORRENT POWER share price is trading up by 5% and its current market price is Rs 429. The BSE POWER is up by 0.6%. The top gainers in the BSE POWER Index are TORRENT POWER (up 5.2%) and ADANI POWER (up 9.9%). The top losers are POWER GRID (down 0.7%) and NTPC (down 1.2%).

DILIP BUILDCON Share Price Up by 8%; BSE CAPITAL GOODS Index Down 0.6% (Today's Market)

Mar 4, 2021 03:12 PM

DILIP BUILDCON share price is trading up by 8% and its current market price is Rs 719. The BSE CAPITAL GOODS is down by 0.6%. The top gainers in the BSE CAPITAL GOODS Index are DILIP BUILDCON (up 8.5%) and BHEL (up 6.5%). The top losers are CARBORUNDUM UNIVERSAL (down 0.1%) and HINDUSTAN AERO. (down 1.8%).

BALRAMPUR CHINI Share Price Up by 10%; BSE 500 Index Down 0.3% (Today's Market)

Mar 4, 2021 03:00 PM

BALRAMPUR CHINI share price is trading up by 10% and its current market price is Rs 213. The BSE 500 is down by 0.3%. The top gainers in the BSE 500 Index are BALRAMPUR CHINI (up 10.3%) and BALMER LAWRIE (up 13.6%). The top losers are DIVIS LABORATORIES and PIDILITE INDUSTRIES .

INDIAN ENERGY EXCHANGE Share Price Up by 7%; BSE POWER Index Up 0.9% (Today's Market)

Mar 4, 2021 02:48 PM

INDIAN ENERGY EXCHANGE share price is trading up by 7% and its current market price is Rs 319. The BSE POWER is up by 0.9%. The top gainers in the BSE POWER Index are INDIAN ENERGY EXCHANGE (up 6.6%) and ADANI POWER (up 9.9%). The top losers are POWER GRID (down 0.5%) and NTPC (down 0.8%).

ITD CEMENTATION INDIA Share Price Up by 8%; BSE REALTY Index Up 0.3% (Today's Market)

Mar 4, 2021 02:36 PM

ITD CEMENTATION INDIA share price is trading up by 8% and its current market price is Rs 93. The BSE REALTY is up by 0.3%. The top gainers in the BSE REALTY Index are ITD CEMENTATION INDIA (up 8.5%) and INDIABULLS REAL EST (up 10.3%). The top losers are PRESTIGE ESTATES and GODREJ PROPERTIES (down 0.2%).

View More Indian Share Market News

Most Popular

It's the Beginning of a New Bull Phase in Smallcaps(Profit Hunter)

Feb 24, 2021

Last time the smallcap index crossed 19k a big correction followed. Here's what makes it different this time.

Make Rs 5,000 Per Day Trading the Market(Fast Profits Daily)

Feb 25, 2021

In this video, I'll show you how to get started on the path to daily trading profits.

The Hidden Tesla in My Great Indian Wealth Project(Profit Hunter)

Feb 23, 2021

An Indian company founded three decades ago in a garage caught my attention...

How Much Money For Day Trading?(Fast Profits Daily)

Feb 22, 2021

In this video, I'll show you how to allocate your capital as a day trader.


India's #1 Trader
Reveals His Secrets

Secret To Increasing Your Trading Profits Today
Get this Special Report,
The Secret to Increasing Your Trading Profits Today, Now!
We will never sell or rent your email id.
Please read our Terms


Mar 4, 2021 (Close)