Auto stocks in the fast lane after govt announces PLI scheme for the sector

The government has announced provision of Rs26,058cr for PLI schemes for the auto, auto component industry and drone industry. The provision comprises an outlay of Rs120cr for drone industry.

Sep 16, 2021 10:09 IST India Infoline News Service

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The Auto stocks were in the fast lane to go with bullish markets on Thursday’s trade after the Union Cabinet Wednesday approved production linked incentive (PLI) schemes for the auto industry, auto component industry, drone industry to enhance India’s manufacturing capabilities.

BSE Auto index was trading at 23,257.49 up 67 points or 0.24%. The index has touched an intraday high and low of 23,332.74 and 23,243.39 respectively.

The major contributor to the index gain is Bosch, Bajaj Auto, Hero MotoCorp, Eicher Motors and Tube Investments.

Bosch emerged as the top gainer in the index up over 5%, Tube Investments soared 2%, Bajaj Auto, Hero MotoCorp, Eicher, and Balkrishna also zoomed over 1% each, while TVS Motor is the flat zone.

However, selling was seen in Motherson Sumi, Ashok Leyland, Tata Motors, Escorts, M&M, Maruti and MRF was down in the range of 2-1% respectively.

The government has announced provision of Rs26,058cr for PLI schemes for auto, auto component industry and drone industry. The provision comprises outlay of Rs120cr for drone industry.

The scheme will incentivize emergence of advanced automotive technologies global supply chain in India. It will bring fresh investments of over 42500 crore in 5-years and an incremental production of over 2.3 lakh crore.

The PLI scheme for drones will bring fresh investments of over 5,000 crore in three years and incremental production of over 1,500 crore.

The scheme will enhance India’s manufacturing capabilities, enable India to leapfrog to environmentally cleaner electric vehicles and hydrogen fuel cell vehicles. It will give a big boost to manufacture of electric vehicles and create additional employment of over 7.6 lakh people, Union Minister Anurag Thakur said on Wednesday.

Meanwhile, benchmark indices extended their record -breaking streak to second straight session on Thursday ahead of weekly index futures and options expiry. The Sensex was up 114 points at 58,838 and the Nifty 50 advanced 42 points to 17,562.

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