Shares of several automobile companies rose on Wednesday after CNBC-TV18 reported that the Production-linked Incentive (PLI) scheme for the automobile sector has been cleared by the Union Cabinet.
The initial outlay approved for the PLI scheme for vehicles and components makers was Rs 57,000 crore. However, it has been reduced to nearly Rs 26,000 crore because the scheme will now only incentivise makers of electric and hydrogen fuel cell vehicles whereas petrol, diesel, and CNG vehicle makers will not be covered under the scheme.
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A total of 22 components have been covered under the auto components PLI scheme.
The PLI scheme for the sector will be effective from FY23 for five years.
Nifty Auto index gradually climbed higher after CNBC-TV18 reported the development. The sectoral index was up 0.6 percent at 10,265.35.
Barring Bosch and TVS Motor Co, all constituents of Nifty Auto were trading above the flatline on Wednesday.
Shares of Ashok Leyland, Balkrishna Industries, Hero MotoCorp, Bajaj Auto, Amara Raja Batteries, Tata Motors, MRF, Mahindra & Mahindra, Exide Industries, Tube Investments of India, Eicher Motors, Maruti Suzuki India and Bharat Forge were 0.1-2.6 percent higher on Wednesday.
(Edited by : Ajay Vaishnav)
