Shares of the country’s leading automobile maker – Tata Motors – rose as much as 3.84 per cent to hit an intraday high of Rs 295.40 after news agency Press Trust of India reported that the company is planning to increase prices of its passenger vehicles from next week as it aims offset the steep rise in procurement cost of essential materials like steel. The quantum of price hike was not indicated by the Mumbai-based auto maker.
“We have seen a very steep increase in the prices of steel and precious metals over the last one year. The financial impact of the increase in commodity prices is in the range of 8-8.5 per cent of our revenues in the past one year,” Tata Motors President Passenger Vehicles Business Unit (PVBU) Shailesh Chandra told PTI.
Earlier this month, the country’s largest car maker – Maruti Suzuki – increased price of its popular car brand Swift and all CNG variants by up to Rs 15,000 (Ex-showroom price Delhi) citing a rise in various input costs.
Auto makers across the world have been hit hard by shortage of semiconductors and rising metal prices in international markets which has led to price hikes, analysts said.
Semiconductors are silicon chips that cater to control and memory functions in products ranging from automobiles, computers and cellphones to various other electronic items.
As of 11:13 am, Tata Motors was among the top Nifty gainers, the stock traded 3.5 per cent higher at Rs 294.50, outperforming the Nifty which was up 0.53 per cent.