Auto Stocks Tumble Amid EV Import Duty Talk - M&M Down 6%

New Delhi, Feb 21 (PTI) Auto stocks tumbled on Friday, with Mahindra & Mahindra tanking 6 per cent amid reports of the government considering lowering import duties on electric vehicles.

Mahindra & Mahindra shares tanked 6.07 per cent, the most among the Sensex firms.

TVS Motor Company shares declined 3.81 per cent, Exide Industries dropped 2.64 per cent, Apollo Tyres (2.49 per cent) and Tata Motors (2.46 per cent).

Additionally, Ashok Leyland fell 2.05 per cent, Hero MotoCorp by 1.45 per cent, Bajaj Auto by 1.40 per cent, Maruti Suzuki India by 0.94 per cent and MRF by 0.71 per cent.

The BSE auto index declined 2.60 per cent to close at 48,135.32.

"Indian benchmark indices started on a tepid note and continued to fall during the day, ending on a negative note on Friday, dragged by financial services and automobile stocks amid mixed global cues, continued FII selling and concern over the US tariff, which dented the investor's sentiment," Ameya Ranadive, Chartered Market Technician, CFTe, Sr Technical Analyst at StoxBox, said.

Further, Ranadive highlighted that during the day, auto sector saw a major fall following media reports that said the government may reduce the import duty to 15 per cent on electric vehicles from 110 per cent as part of a new EV policy as Tesla prepares to enter the Indian market, which will increase the competition among the domestic auto players.

Meanwhile, the BSE benchmark Sensex dropped 424.90 points or 0.56 per cent to settle at 75,311.06.

The NSE Nifty declined 117.25 points or 0.51 per cent to 22,795.90.

According to Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services, "Amongst sectoral indices, Nifty auto was the top loser, declining 2.6 per cent as the global EV major Tesla is reportedly planning to start retail operations in India by April'25, thus intensifying competition in India's premium EV space.

Further, news reports suggest that the government is planning to notify the new EV policy, allowing lower import duty for EVs, Khemka said.