Auto stocks skid on diesel levy reports
Auto stocks today declined by up to 3.3 per cent on the bourses led by 3.38 per cent decline in Maruti Suzuki India stock following reports that the government might impose an additional tax on diesel vehicles.
Shares of Maruti Suzuki fell by 3.38 per cent to settle at Rs 1,107.50 on the BSE. During the day, the stock lost 3.86 per cent to Rs 1,102.
Among others, Tata Motors was down 2.10 per cent, while Mahindra & Mahindra fell by 1.75 per cent.
Two-wheeler majors Bajaj Auto and Hero MotoCorp shed 0.65 per cent and 1.72 per cent, respectively.
Following the dip in the blue-chip auto stocks, the BSE auto index closed at 9,165.40, down 1.47 per cent.
"Auto stocks fell on reports that the government may tax diesel cars to compensate for the subsidy on diesel," Sharmila Joshi Head Equity Fairwealth Securities said.
Inventure Growth and Securities Head Research Milan Bavishi said: "Downward pressure on the Sensex was put by auto companies which saw selling pressure on reports that diesel cars may get expensive, with plans of imposing a special tax on diesel vehicles."
According to reports, the government plans to impose additional levies of Rs 1.7 lakh on small diesel cars and Rs 2.55 lakh on medium and large diesel vehicles such as sedans and SUVs.
The BSE 30-share Sensex ended the day 17.71 points higher at 16,880.51.