The Indian stock market had a gap down opening on March 30 following weak Asian cues as coronavirus pandemic continues to create havoc across the globe.
At 09:27 hrs, the Sensex was down 816.80 points or 2.74 percent at 28998.79, and the Nifty down 237.65 points or 2.74 percent at 8422.60.
Among the sectors, banks along with the auto index dragged the most, down almost 4 percent each.
Nifty Auto shed 4 percent in the morning session as the spread of COVID-19 has forced automakers to shut manufacturing operations. Share price of Mahindra & Mahindra was down over 7 percent after the company on March 22, 2020, announced suspension of the manufacturing operations at Nagpur Plant with immediate effect and Chakan (Pune) and Kandivali (Mumbai) from March 23, 2020, onwards.
Eicher Motors shed 6 percent, Bajaj Auto, Tata Motors and TVS Motor Company were down 4-5 percent each.
Moody's Investors Service has placed the ratings on Tata Motors on review for a possible downgrade. The review, which will be completed over the next 90 days, is on the Ba3 corporate family rating and Ba3 senior unsecured debt rating, Moody's said in a statement.
However, Motilal Oswal has a buy rating on Tata Motors with target at Rs 178 signalling an upside of 102 percent. It is of the view that the reduction in China sales resulting from the coronavirus impact is estimated to reduce JLR's full-year EBIT margin by about 1 percent, however, free cash flow in 4QFY20 is still expected to be modestly positive.
Showrooms across major cities and towns have downed shutters choking sales of Bharat Stage IV (BS4) vehicles, auto factories are under lockdown hampering supplies of BS6 upgrades and market sentiments are at its worst with the stock market going back to the levels of early 2017.
As per data shared by the SIAM, passenger vehicle sales in the domestic sector during April-February declined by 15 percent to 2.63 million units while commercial vehicle segment reported a fall of 22 percent compared to the same period last year.
Share price of auto ancillary stocks including Apollo Tyres, Motherson Sumi Systems, Bharat Forge and MRF were down 2-3 percent each as the coronavirus pandemic continues to bite.
"The industry was already under pressure due to plummeting sales and there was also uncertainty from BS4 to BS6 [shift]. Everything has come to a standstill. We do not know how long it will last. There is a production loss of Rs 1,200 crore a day for the component industry," said Vinnie Mehta, director-general, Automotive Component Manufacturers Association.
“At the request of the Government of India, Maruti Suzuki examined its ability to assist in the production of ventilators, masks and other protective equipment”, the company said in a statement.
MSIL entered into an arrangement with AgVa Healthcare, an existing approved manufacturer of ventilators. MSIL would work with AgVa Healthcare to scale up the production of ventilators to reach a volume of 10,000 units per month.Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol advises users to check with certified experts before taking any investment decisions.