Keep auto stocks in portfolio: Choksey

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Keep auto stocks in portfolio: Choksey

Deven Choksey of KR Choksey Securities is of the opinion that one should keep auto stocks in portfolio for next six months.

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Excerpts from Bazaar on CNBC-TV18 Watch the full show » RELATED NEWS Bajaj Auto Sep sales jumps 18.4% at 2.32 lakh units Bajajs may now fight for Hindusthan, consumer care Banks bar Auto firms from offering zero finance schemes ALSO READ See previous views by Deven Choksey See what other Experts & Brokerages are saying about Bajaj Holdings See messages about Bajaj Holdings Bajaj Holdings BSE | NSE 28/05/12 Are Mutual Funds betting on Bajaj Holdings? Other Stocks in this news Maruti Suzuki India | Tata Motors |

Deven Choksey of KR Choksey Securities is of the opinion that one should keep auto stocks in portfolio for next six months.

Choksey told CNBC-TV18, "In Maruti , the story likely to be continuing from the last month where they have left, the growth is likely to be continuing on the volume side. But most importantly if one is looking at company like Maruti, one finds that one particular product which they have launched in the last quarter that particular product is making lot of difference, I am referring to the SX4. This is bringing lot of volume number as far as company is concerned."

He further added, "If one looks at the overall space of auto and if one looks at the valuations particularly, the auto companies are comparatively trading cheaper to the Sensex valuations as a whole. If one looks at Maruti on a forward basis, the stock is trading at close to 15 whereas the Sensex stock on a forward basis trading close to 19. So to a greater extent, the rerating is a possibility as far as this is concerned."

"Interest rate scenario as we are looking at this month, we are expecting some amount of softening of interest rate happening and indications coming in for the further balance part of the year maybe this sector, which is so sensitive about the interest rate would find good amount of volume pickup in the second half as I see. Preference would be definitely Maruti and Tata Motors , for the car and commercial vehicles respectively."

"In the two-wheeler space, Bajaj Auto same rational same argument maybe in the October to December quarter demerger will be coming up so to that extent it looks favourably placed over and above the organic growth coming out of the XCD vehicle, which is likely to record good numbers in October and November over September. So all in all put together it's a positive space for in my portfolio. I recommend auto should be in the portfolio for the next six months definitely for the appreciation that one wants to enjoy over next three-six months in this financial year."