Last year (Jan 16th, 2008) I had predicted a good show in the stock markets for the Tata Nano part suppliers, over a 1-2 year horizon. I checked up on these stocks and I was surprised, mostly negative, with the results. Taken as a basket of stocks, the group fell 28% as compared to the Sensex’s fall of 18% as on 23rd October 2009.

Exide Industries (+30%)
Lumax Industries (-51.59%)
Sona Group (-46.3%)
Rico Auto (-42.43%)
Sekurit Saint-Gobain (-49.52%)
MICO Bosch (-9.58%)

One of the reasons is definitely the delayed release of the Nano. The first Nano was handed to a customer on July 17th, 2009, almost a year later than the once-officially announced availability. So it does warrant another year’s time before one thinks of selling off these stocks. Remember CRISIL did report that the Nano has the potential of increasing the Indian car market by 65%. And how did Tata Motors perform at the stocks? Compared to Jan 16 2008, a fall of 24.41%. Obviously hurt by the Singur plant delay and shut-down, the delayed release, increasing raw material costs and the recession.

By the way, the only stock I invested in back then was Exide Industries , never mind how many. An increase of 30% while all the other stocks including the Sensex are in negative! Exide industries will continue to do well(it doubled net profits this quarter!). The others should climb once the Nano catches up and the various versions come out.