The Nifty Auto index rose more than 1 percent on Monday, emerging among the top sectoral gainers, after the latest auto sales data from the Federation of Automobile Dealers Associations (FADA) showed strong growth in vehicle sales for June.
The index gained 1.1 percent, snapping its previous session's decline, as investors bought auto and auto ancillary stocks following the upbeat sales numbers.
According to FADA, overall vehicle sales rose 21.8 percent year-on-year to 2.6 million units in June, the highest-ever sales for the month, driven by strong demand for passenger vehicles and two-wheelers.
Retail passenger vehicle sales increased 28.6 percent from a year ago to 410,853 units.
The rally was broad-based, with 14 of the 15 constituents of the Nifty Auto index trading in the green.
TVS Motor Company was the top gainer, rising more than 2 percent, followed by Bajaj Auto, which also gained about 2 percent.
Eicher Motors, UNO Minda, Tube Investments of India and Mahindra & Mahindra advanced between 1 percent and 1.5 percent.
Exide Industries, Bharat Forge, Ashok Leyland and Maruti Suzuki India also rose up to 1 percent.
FADA said total two-wheeler sales climbed 21.2 percent year-on-year to 1.8 million units in June.
The share of electric two-wheelers rose to 10.6 percent, crossing the double-digit mark for the first time, it added.
FADA said demand for alternative-fuel passenger vehicles has increased following the rise in petrol and diesel prices linked to higher crude oil costs amid the Middle East conflict.
Maruti Suzuki India had said last month that bookings for its CNG vehicles rose 40 percent after the fuel price hikes.
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