Dealal St: Indian auto stocks hit bump, Sula gets hangover

Mumbai: Stocks of companies that could potentially gain from the India-EU trade deal saw their prices rally in Tuesday’s relatively steady market. At the same time, companies that may face increased competition from their European counterparts saw their stock prices dip.

Apex Frozen Foods, a seafood company that’s a major shrimp exporter from India, saw its stock price jump nearly 12% while Avanti Feeds, another company from the same industry, closed 2.1% up. Once the trade deal becomes effective, Indian companies would find it lucrative to tap the European market for shrimps and hence the bullishness, market players said.

Auto ancillary and gems & jewellery exporters are also expected to gain from the deal. For the gems & jewellery sector, this could be a timely boost at a time when exporting to the US, one of their biggest markets till a few months ago, has become a tough proposition.




According to Colin Shah, MD, Kama Jewelry, the India-EU trade agreement looks promising and could bring relief to the gems & jewellery industry in India, given the current trade dynamics with the US. “This strategic diversification of Indian exports will help revive the sheen of the gems & jewellery trade, which has been on a decline for months, with occasional spikes in between,” Shah said.

Among the probable losers from the deal could be automakers and wine producers, in the form of increased competition from the European companies. Among the leading passenger vehicle manufacturers, M&M lost 4.2% while Hyundai Motors India was down 4%.

Sula Vineyards closed 3.4% down as market players feel it could face competition from European wine makers.