FinQuest Securities upbeat on Bajaj Auto, Tata Motors

FinQuest Securities' report on auto space

"Bajaj Auto's (BAL) volumes have been sluggish over the past few months mainly on the back of the slowdown in the motorcycle industry coupled with the loss of market share to HMSI and off late due to the ongoing strike at its Chakan plant. We continue to be bullish on the stock as BAL is a company that offers products with superior technology at a reasonable price while churning out new models much faster than the competition. BAL has recently launched one of the most powerful premium motorcycles in india the "KTM Duke 390" at a mouthwatering price of Rs 1.8 lakhs while it has lined -up upto 6 Discovers to be launched in the FY14. It will also launch the new 2 new Pulsars, one of which would be the new flagship Pulsar 370. We are also very bullish on the new Duke 390 and the new flagship Pulsar 370 which would carve a new frontier in affordable sports motoring. We believe the new crop of Discovers would be highly advanced in technology and should help in gaining incremental share from Heromoto. We continue to maintain our bullish view on BAL with a price target of Rs 2,189."

"Tata Motors's (TML) domestic performance has not been good off-late mainly due to sluggish CV market. Even the passenger car market has done badly while even UVs performance was nothing to write about in Jun'13. However some green shoots are appearing as volumes have started to pick-up on a M-o-M basis. Since more than 90 percent of the stock's value is driven by the JLR's business JLR's success is critical to the company. JLR has been continously churning out new models which have been very well received in the market. We continue our bullish stance on TML and rate the stock a BUY with a target price of Rs 397," says FinQuest Securities research report.

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