By Irshad Mushtaq
Since 2011, the auto sector has soared to new heights, with the auto sector index leaping from 3535 to an astonishing 23339 in May 2024. This represents a remarkable 560% increase, turning an investment of Rs 35 lakh in 2011 into a staggering Rs 2.33 crore today. This phenomenal return can be credited to a portfolio of shares in powerhouse companies like Bajaj Auto, Hero Motors, Maruti, Tata Motors, MRF, Mahindra, and many others.
One of the most compelling aspects of this sector is that there are no ongoing operational costs such as employee salaries or depreciation. The only expense to consider is a 10% tax on profits, leaving you with a considerable sum of money.
Opportunities for All
Investing in the stock market is often perceived as a playground for the wealthy. However, even drivers, travel agents, and transport companies can tap into this lucrative opportunity. The auto sector offers the perfect avenue for SIP (Systematic Investment Plan) investments, allowing you to grow your wealth gradually with small, regular investments.
Why Now Is the Right Time
1. Electric Vehicles on the Rise: The automotive landscape is transforming with the rise of electric vehicles. This revolution is leading to new opportunities in the auto sector, making it an attractive investment destination.
2. Scrap Policy: The new policy mandates a life span of 15 years for vehicles, driving up the demand for new automobiles as old ones are scrapped. This boom will directly benefit the auto sector, fueling its growth.
Broaden Your Horizons
You don’t need to pick individual stocks to benefit. Instead, focus on investing in the entire sector. Diversifying your investment reduces the risks and aligns with the sector’s overall growth.
In Summary
The auto sector presents a golden opportunity for dramatic financial growth. Whether you’re an investor with deep pockets or someone looking to start small with SIP, the auto market’s potential is enormous. With the boom in electric vehicles and the newly implemented scrap policy, the stars are aligning to make this sector one of the most lucrative options available. Don’t miss out—accelerate your wealth today by tapping into the auto sector!
The author is an investor, author, founder M I Securities and Business Partner at Sharekhan Srinagar, J&K. He can be reached at [email protected]
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