Is Diwali proving to be auspicious for automotives?

Dealers claim to have seen a 15-20 percent rise in sales over last year. However, this year sales growth is being viewed very differently by different companies.

Caught in a severe slowdown, auto and two-wheeler companies had ushered in a quiet Diwali last year. This year, however, is proving far brighter thanks to a new government at the helm of affairs and an improving economy - together, which has invigorated customer sentiment. CNBC-TV18's Farah Bookwala Vhora has been hopping across dealer outlets to get a sense of the prevailing mood.

Dealers claim to have seen a 15-20 percent rise in sales over last year. However, this year sales growth is being viewed very differently by different companies. The dealers of Maruti Suzuki say they have had a very good year with consumers showing increased buying power. On the other hand, dealers of Honda and Hyundai say their sales growth can be turned above average at best and that the consumers have been stalling purchases, as they cannot make up their mind as to which model they should be choosing from the plethora of options that have hit the market in the last one year.

Read more at: Should you bet big on Hero Moto amid Diwali cheer?

On the positive side, consumers have chosen to upgrade to newer models this year with anywhere between 40-80 percent of sales coming from those consumers who have chosen to upgrade to newer models. Some of the newer models that have hit the market in the last one year are also doing extremely well. In the case of Maruti Suzuki - the Celerio and the Ciaz, in the case of Hyundai - the i20, Santa Fe and Eltantra and in the case of Honda - the new Honda Amaze, the new Honda City and the Mobilio are all seeing very good traction with some of the models seeing a waiting period of 4-5 days in terms of deliveries.

All the dealers also said that the petrol versions are doing better than the diesel versions because of increasing parity between petrol and diesel. Coming to the two wheelers space, Hero MotoCorp hit a record high in trade today after the company said it had sold one and half lakh units on Dhanteras alone which is a 40-50 percent rise over last year's sales. Bajaj dealers said that they are seeing very good traction and they have seen about 30 percent rise in sales on account of very good sales of Pulsar 220 and KTM 200 Duke both of which are premium products.

Maruti Suzuki stock price

On October 22, 2014, Maruti Suzuki India closed at Rs 3181.70, up Rs 105.80, or 3.44 percent. The 52-week high of the share was Rs 3188.40 and the 52-week low was Rs 1484.20.

The company's trailing 12-month (TTM) EPS was at Rs 96.45 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 32.99. The latest book value of the company is Rs 694.45 per share. At current value, the price-to-book value of the company is 4.58.