Hero and Maruti are good bets in the auto space: Ajay Bagga, Market Expert

In a chat with ET Now, market expert Ajay Bagga shares his thoughts on the auto space. Excerpts:
ET Now: What is your call on the auto pack?

Ajay Bagga: It has been very divergent. When it comes to Hero, because of the royalty payments going away, you saw a 59% jump. But even after taking that out, it is a good set of results.

I would say that auto is very much pointing to a strong economic revival in India and has to be owned. Top picks would be Maruti as the market leader and Hero on the two wheelers side.

When it comes to two wheelers, we had some misgivings on the quantity two to three months back because of the monsoon. Nearly 60-70% is sold in semi-urban and rural areas, but we are not really seeing that impact on the rural consumption right now.

Thus, Hero and Maruti could be two picks that can be looked at. Tata Motors could be the third one, but it has a huge component of international contribution. Let us watch China numbers coming out tomorrow. That will be a good indicator, but Tata Motors is looking good as well.