Sandeep Singh
Posted online: Friday, January 11, 2008 at 0006 hrs
New Delhi, January 10: Tata Motors stole the show at the Auto Expo today in New Delhi, with media from across the world striving hard to get a glimpse of the People’s Car. Contrary to the hype in Delhi, stock markets in Mumbai showed no strong gains for the company’s stock.
The stock closed 2.8 per cent down, almost double the percentage fall in Sensex of 1.4 per cent. “I don’t see any correlation of the share price correction with the unveiling of the car,” said Amar Ambani, vice president (research) India Infoline.
Tata Motors stock prices started to gain momentum over the past couple of weeks and its share price rose from Rs 695 on December 18, touching a high of Rs 816 on January 3, a rise of 17 per cent. It closed today at Rs 749. According to Amitabh Chakraborty, president (equity) Religare Securities, “The market looks ahead and so the stock went up on the optimism of the car over the past few days. Now that the car is unveiled, there has been some profit booking.”
The car definitely holds a stake in the future of the company, said, Ratan Tata, chairman, Tata Group, “It will be a profitable venture.” If it becomes a success on the road, it will definitely run the fortune for the company, “Depending on its success, the car can build strength for the stock,” said Chakraborty.
On the other hand, if the car fails, all the investment that has gone into the making of the People’s Car will go futile and may see the stock lose some shine.
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