A major economic pillar, the Indian automobile industry contributes to GDP growth and generates employment through its vast manufacturing base and expanding exports, especially in the areas of tractors, two- and three-wheelers, and other vehicles. On the other hand, India is poised to emerge as a thriving global center for electronics and consumer durables, leveraging technology and sustainability while capitalizing on its significant domestic market and highly skilled labor force.
Two stock recommendations from Trade Brains Portal for Monday, 8 September
Bajaj Auto (Current price: ₹ 9,075)
- Target price: ₹ 10,800 in 12 months
- Stop-loss: ₹ 8,210
- Why it’s recommended: Bajaj Auto is a flagship company of the Bajaj Group, a 2W and 3W manufacturing company exporting to over 79 countries globally, and is the 2nd largest player within the motorcycle business in India and India’s largest exporter of 2-wheelers. The company operates 5 manufacturing plants across India, with a total annual installed capacity of 7.2 million units. Bajaj Auto became the first 2-wheeler company in the world to reach a market cap of ₹1 trillion. Bajaj Auto has a diversified product portfolio and a strong market presence overseas. It has popular brands in its portfolio like Pulsar, KTM, Triumph, Chetak, Dominar, and Avenger. Furthermore, the company has entered the e-2W scooter market with the Chetak brand and is among the top 5 players in the industry.
As of Q1 FY26, the company reported revenue from operations of ₹13,133.35 crore, up 10% YoY, led by exports, CVs, premium motorcycles, and Chetak with double-digit growth across Africa, Latin America, and Asia. The company is anticipating over 20% growth from exports in the coming years. EBITDA stood at ₹3,301.92 crore, and PAT at ₹2,210.44 crore. The company has reported sales of 5,29,344 units for 2-wheelers and 1,05,464 units in the commercial vehicle segment in Q1 FY26, and their August sales stood at 1,84,109 units for 2-wheelers and 48,289 units in the commercial vehicle segment. The company is committed to providing ₹1,000 crore capex as part of the PLI scheme in a horizon of 5 years and will incur ₹600-700 crore in FY25-26, mostly towards maintenance capex. The company board approved a final dividend of ₹210 per share of face value ₹10 each for the year ended FY25.
In FY25, they had a market share of 16.6% of motorcycle sales in India and a 46.3% share in the export market. They are also a dominant player in the ICE 3W segment, with a market share of 75.7% in FY25 and around 52.4% share in the ICE 3W goods carrier segment. The company is also the largest exporter of 3Ws from India. The company is on track to expand its production capacity to 50,000 units per annum this year at Bajaj Brazil after its sales touched 7,000 units in Q1 FY26. Quarterly commercial vehicle sales volume was more than 1,00,000 units for the 8th straight quarter, making the company a market leader in the 3W EV space in Q1FY26.
- Risk factors: The nation’s macroeconomic landscape and the automobile industry are strongly related. Geopolitical issues, like the tariffs imposed by the Trump administration, can affect industry and result in supply chain disruption and excessive costs. The industry may be impacted by other macro events such as global inflation, changing national demand and tastes, the availability of input materials, and a reduction in per capita income across economies, which will reduce people’s purchasing power. The 2W segment has become extremely competitive; players like Hero MotoCorp, Honda Motorcycles, Suzuki Motorcycle, and TVS Motors continue to launch new models to gain market share.
Crompton Greaves Consumer Electricals Ltd (Current price: ₹ 327)
- Target price: ₹ 425 in 12 months
- Stop-loss: ₹ 275
- Why it’s recommended: In 1947, L.K. Thapar acquired Crompton Parkinson Works Ltd., which eventually merged with Greaves Cotton & Crompton Parkinson Ltd. in 1966 to form the Thapar Group, marking the beginning of Crompton Greaves. In order to create Crompton Greaves Consumer Electricals Ltd. (CGCEL), its consumer durables division was integrated in 2015. Today, the company is a leading player in consumer electricals, offering fans, lighting, pumps, and household appliances. It holds the top position in fans and residential pumps, ranks sixth in air coolers, and fifth in water heaters. With a strong pan-India presence, the company operates through 23 branches, 7 manufacturing plants, 6,100+ channel partners, and over 2.36 lakh retail outlets. It has more than 12,000 SKUs and strong growth prospects, fueled by a focus on brand building and consumer sentiment.
In Q1 FY26, the company’s consolidated net sales stood at ₹1,998 crore, whereas EBITDA was at ₹192 crore, and net profit was at ₹124 crore. In Q1 FY26, the solar pumps segment recorded a 2X year-on-year growth. The company’s acquisition of the largest-ever single order of the Maharashtra Energy Development Agency (MEDA), valued at ₹101 crore, demonstrated its dominance in this industry. Butterfly Gandhimathi Appliances Ltd., a subsidiary of the company, had revenue that stood at ₹187 Crore, achieving strong EBITDA growth of 39% YoY. It witnessed a market share growth in core categories, supported by strong execution and channel recovery. Lighting segment EBIT rose 41% YoY to ₹29 Crore, with margins up 370 bps to 12.6%, driven by improved product mix and operational efficiencies.
The consumer durables sector contributes around 0.6% of India’s GDP, and is projected to grow at a CAGR of 11%, reaching Rs. 3 lakh crore by 2029. Crompton 2.0 (Nucleus and Xtech) vision is implemented to help accelerate revenue growth to double digits. This vision is aimed at increasing the market share and growing sustainably in core products like fans, pumps, and large domestic appliances. It also aims to transform the lighting business through product innovation, range expansion across panels, premiumization of products, and forays into new segments. To establish the vision and maintain the competitive advantage, the company increased its R&D spend as a percentage of revenue from 0.5% in FY21 to 1.02% in FY25.
- Risk Factors: The company faces competition in the domestic consumer durables sector that has intensified over the past few years. Organized players such as Havells India Ltd. have established a strong consumer connection and brand recall. It is facing pricing pressures from unorganized players. Further, raw materials and purchases of traded goods account for 68-70% of sales. Key inputs such as copper, aluminum, and steel volatility due to geopolitical issues and supply chain concerns may hamper the margins. In Q1FY26, the fans segment remained subdued due to a decline in Table, Pedestal, and Wall-mounted fans (TPW) as the monsoon came early in 2025.
Market Recap
On Friday, the Nifty 50 opened on a positive note at 24,818.85, rising 84.55 points from its previous close of 24,734.3. It hit an intraday high of 24,832.35 and closed the day at 24,741, gaining 6.7 points, or 0.027%. It finished only below the 50-day EMA but stayed above the 20/100/200-day EMAs daily. The BSE Sensex followed a similar trajectory, rising 294.41 points after opening at 81,012.42 from its previous close and closing the day at 80,710.76, losing -7.25 points. In terms of momentum, the Nifty 50’s Relative Strength Index (RSI) stood at 49.31, while the Sensex RSI was at 47.4, both remaining below the overbought threshold of 70. The Bank Nifty Index also followed the slightly positive trend and ended in green, rising 39.1 points, or 0.07%, to close at 54,114.55.
Among the major gainers, the Nifty Auto Index was the top gainer, closing at 26,320.6, up by 325.75 points, or 1.3%. Auto stocks, including Eicher Motors, Mahindra & Mahindra, Ashok Leyland, and Exide Industries, rose up to 2.4%. The Nifty Capital Market Index followed the gains, closing at 4,271.35, up by 43.8 points, or 1%. BSE Ltd was the biggest gainer, increasing by 4.5%, followed by KFin Technologies Ltd, which gained 2.8%, and CAMS Ltd, up 1.8%. The Nifty Transportation & Logistics Index also remains one of the top gainers, closing at 25,248.7, up by 236.35 points, or 0.9%.
The Nifty IT index fell the most during Friday’s trading session among the main losers. The index closed at 34,635.85, down -507.25 points, or -1.44%. The top loser, Persistent Systems Ltd, fell -3.1%. Other IT stocks, such as Mphasis Ltd, Coforge Ltd, and HCL Technologies Ltd, also fell up to -2.2%. At 56,292.10, the Nifty FMCG Index also ended the day lower, down -811.95 points, or -1.42%. Varun Beverages Ltd., ITC Ltd., Radico Khaitan Ltd., and Emami Ltd. are among the biggest losers, with their shares falling up to -4.1%.
On Friday, Asian markets displayed a bullish trend. Hong Kong’s Hang Seng Index ended the day lower at 25,428.00, jumping 369.49 points, or 1.45%. The Shanghai Composite Index closed at 3,812.51, climbing 46.63 points, or 1.22%, following the same trend. The KOSPI Index for South Korea ended the day higher at 3,205.12, up 4.29 points, or 0.13%. At 42,984.00, Japan’s Nikkei 225 Index also ended the day higher, up 403.73 points, or 0.94%. At 4:54 p.m. IST, the US Dow Jones Futures were down -14.74 points, or -0.03%, at 45,604.55.
This week, the Nifty index gained by 1.29%, or 314.15 points, closing above the 24,700 level. Indian markets witnessed a revival as the country posted a five-quarter high GDP growth of 7.8% in Q1 FY26, surpassing the RBI’s estimate of 6.5%. This positive momentum was further supported by optimism surrounding the upcoming GST reforms set to take effect on September 22, 2025. On the other hand, geopolitical concerns remain the key reason for bearish market sentiment, especially after the SCO meeting in China, which India attended after 7 years.
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