M&M hits a bump

While Tata Motors is currently the top gainer on the BSE, thanks to the record monthly sales of JLR, which YoY rose 16%, its close rival, M&M was down in the red. The stock is down 1.35% at Rs.826, with an intra day low at Rs.821.75.

The reason for the red hue in M&M is labour trouble. The company stated yesterday late evening that workers at its Igatpuri plant stopped work due to tool down strike by the Union. This was a reaction to the suspension of two workers on disciplinary grounds, and one of them was a union bearing officer. Though the company has stated that it has sufficient stock of engines for production of its vehicles, the market is obviously worried. Thanks to the precedent set by Maruti  labour strike, any such news has become extremely worrisome, not knowing how serious it could become.