Maruti Impasse

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Check the Report Here.

At one time, nearly two years back, before, the Suzuki took away the reserve of the company as their royalty back to their mother, I was very bullish. The auto market figures were very clear to me. Maruti had sold 11 lakh units. But then, share prices did not move as I expected. I was dreaming that it would pass 1400. I had increased my holding. But then royalty flight took place. I booked losses. Since then, I have a nominal holding in it. Now this production loss and labour problem are going for quite a long time. The report has some ominous lines in it. The management is warning that the workers would have damaged the machinery. The auto scene has changed. Now there is a tough competition. The 'Search Engine' thrust is not too appealing to me. I am not impressed. Now some real players are there. You can not over look the efforts of Tata Motors and Mahindra. Some real babies are there who will cut into the market share when the company is struggling with labour problem. Where are the management tricks of Japanese?

I would like to see some thing below 950 in such a scenario. There are talks about figures which the company is bound to suffer along with the Harayana government.

Also what about the ancillary units like Rico Auto? I had shifted to these investment after royalty episode. I suffered further losses in Rico Auto. Rico Auto is very low at present. Similarly the Sona Koyo?

This is share market. Nearly a year back, the picture was so good. The moving wheels were giving signs of good economy. Honda left Hero. Maruti took away the money. Tata Motors has high debt ratio. Mahindra came out of joint venture. Nano miracle did not materialize. The petrol prices shot up. The inflation is increasing. Where is the money now? The agriculture has to produce some more wealth so that the urban based economies continue to work.

I am going to remain away from Auto sector at least up to end of December.

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