Budget in India Takes Incremental Approach, Auto Sales Rise

Mukesh Buch
02 Mar, 2015
New York City

Stocks in Mumbai extended gains and auto makers report rising sales. Ashok Leyland said total auto sales in February soared 36%. Maruti Suzuki India sales rose 9%.

[R]6:00 PM Mumbai – Stocks in Mumbai extended gains and auto makers report rising sales. Ashok Leyland said total auto sales in February soared 36%. Maruti Suzuki India sales rose 9%.[/R]

Stocks in Mumbai closed higher and extended gains set in the volatile session on Saturday after Finance Minister Arun Jaitley released budget for the next fiscal year.

Jaitley took gradualist approach in the first full-year budget of the newly elected government rather than a big-bang approach that most investors and economists had anticipated.

Though the central government budget was hard to criticize, offered to lower corporate tax rate to 25% from the current 30% in the next five years, share more revenues with states and proposed number of social security and insurance programs for the poor.

Finance Minister estimated economic growth to accelerate in the next fiscal year between 8% and 8.5% but budget deficit to widen to 3.6% and increase infrastructure spending by 11%.

Indian rupee rose 3 paisa to 61.86 against one dollar.

The Sensex Index rose 97.64 or 0.3% to close at 29,459.14. The CNX Nifty added 54.90 or 0.6% to 8,956.75.

Gainers & Losers

Ashok Leyland Limited climbed 4.5% to ₹72.90 after the commercial vehicles maker said total sales in February soared 36% to 10,762 units compared to 7,915 units in the same quarter last year.

The company reported medium and heavy commercial vehicle sales surged 48% to 8,230 units and light commercial vehicles increased 8% to 2,532 units compared to a same period last year.

Atul Auto Ltd jumped 3.3% to ₹586 after the rickshaw maker reported February total sales jumped 9.57% to 3,402 units compared to 3,105 units for the same period a year ago.

Bajaj Auto Limited declined 4% to ₹2,074.75 after the second largest two-wheeler maker said total sales in February plunged 22% to 243,319 units compared to 313,294 in the same period last year.

The company added motorcycle sales dropped 20.9% to 216,077 units compared to 273,323 a year ago period. Commercial Vehicles also slipped 32% to 27,242 units.

Eicher Motors Limited increased 1.8% to ₹16,515.85 after the trucks and buses maker said February total sales of subsidiary of the company’s VE Commercial Vehicles advanced 9.2% to 3,100 units compared to the same period previous year.

J B M Auto Limited soared 10.4% to ₹236.40 after the sheet metal component maker received orders for 200 buses.

Maruti Suzuki India Limited jumped 2.5% to ₹3,707.95 after the automaker said total sales in February rose 8.7% to 118,551 units compared to 109,104 in the same period a year ago.

Total domestic sales in the company advanced 8.2% to 107,892 and exports climbed 14% to 10,659 units in the same period last year.

Natco Pharma Ltd jumped 4% to ₹1,426.55 after the pharmaceutical ingredients maker signed an agreement with U.S.-based Gilead Sciences, Inc. to manufacture and sell generic versions of its chronic hepatitis C medicines.

Olacabs, the smart phone app for personal transportation agreed to acquire cab “TaxiForSure” for about $200 million in cash and stock.

The company has 100,000 service providers registered on its app in 47 cities. TaxiForSure has recently completed $6 million funding from its existing based U.S. venture capital funds.

Olacabs received $210 million from a group of investors led by Japan-based Softbank in October.