Maruti, Bajaj Auto: Why auto shares are rising today; top stock picks

Maruti Suzuki India Ltd, Bajaj Auto Ltd, Hero MotoCorp Ltd, Mahindra & Mahindra Ltd (M&M) and Eicher Motors jumped up to 5 per cent in Monday's trade, while shares of Tata Motors Passenger Vehicles (TMPV) Ltd and Tata Motors, among others, were trading marginally higher, tracking April auto sales figures. Analysts noted that Maruti Suzuki and Tata Motors PV led passenger vehicle segment sales for the month, with domestic PV dispatches up 32 per cent YoY and 31 per cent YoY, respectively. Eicher Motors' Royal Enfield fared better in the two-wheeler segment, analysts noted.

Antique Stock broking said passenger vehicles and commercial vehicles witnessed robust momentum led by Maruti Suzuki and Tata Motors, while the two-wheeler segment saw strong volumes driven by Hero MotoCorp, Royal Enfield and sustained overall EV traction. The numbers, it said, were supported by improving affordability post GST rationalization, healthy rural sentiment, and continued premiumization trends.
 
Auto stocks gain up to 5%
Data showed Maruti Suzuki gained 3.92 per cent to Rs 13,837 piece. The scrip rose 4.97 per cent to hit a high of Rs 13,976 earlier today. It was followed by Bajaj Auto, which gained 3.92 per cent to Rs 10,386. Hero MotoCorp, M&M and Eicher Motors added 2-4 per cent. TVS Motor, Ashok Leyland, Tata Motors PV and Tata Motors added up to 0.8 per cent.

Auto stock picks 
Antique Stock broking said the ongoing demand upcycle may sustain over the next two-three quarters, with elevated industry growth likely through 2026 before normalising gradually in 2027.

"That said, escalating geopolitical tensions remain a key risk for export volumes and sector profitability, particularly in 1HFY27, through higher freight costs, commodity inflation, and potential supply-chain disruptions, said Antique Stock Broking.

Following the recent market correction, this brokerage prefers prefer Maruti Suzuki India, TVS Motor Company and Bajaj Auto, supported by favourable long-term risk-reward dynamics.

Emkay Global said it favours two-wheeler and commercial vehicle OEMs over passenger vehicle makers, owing to a similar demand trajectory, albeit better pricing flexibility amid commodity pressures.

"Within 2Ws, while we prefer TVS Motor Ltd and Ather Ltd on structural basis. We believe Bajaj Auto offers a better risk-reward, with valuation at 22 times FY28 PER vs 27-29x for TVS/Eicher Motors RE. In CVs, we prefer to play the upcycle with TMCV. In Ancillaries, we favor Shriram Pistons, Craftsman Automation, JK Tyre, and Pricol," the brokerage said.