You are not a crorepati because you bought this SUV: We Explain
We all wish to buy that swanky new car we have been waiting to get all our lives. However, there is a fascinating yet saddening financial exercise that reveals that choosing to invest in stocks rather than purchasing that dream SUV could have turned you into a crorepati. Now, you may think we are joking or something, but be assured that by the end of this read, if you bought yourself a car post-COVID, you’d regret your decision. So, without any further delay, here is how you could have been a crorepati, which you aren’t.
Tata Harrier vs. Tata Motors Shares
Back in September of 2019, Tata Motors launched the Harrier mid-size SUV in India. At the time, it was priced around Rs 12.69 lakh for the base variant, and it went up to Rs 16.25 lakh for the top-spec variant. Now, let’s say you bought the top-of-the-line variant for around Rs 20 lakh on-road price.
At the same time, Tata Motors shares were trading at approximately Rs 100 per share. So, fast forward to today, and the current share price of Tata Motors has soared to over Rs 1,100. Now, imagine that had you invested the Rs 20 lakh in Tata Motors shares in 2019, you would have purchased 20,000 shares.
So, with the current share price at Rs 1,100, those shares would now be worth a staggering Rs 2.2 crore. In contrast, the Tata Harrier, like most vehicles, has depreciated over time, currently valued at around Rs 12-15 lakh. Now, if you are one of those buyers who bought this SUV, you will most likely regret your decision.
Mahindra Scorpio-N vs. Mahindra & Mahindra Shares
Now, if you are a Mahindra Scorpio-N fan, which is also another very popular SUV in India, you would have also met with the same fate. If you had purchased the S11 variant of this SUV back in 2019 for Rs 20 lakh, you would have enjoyed its butch design and powerful engine.
However, had you invested the same amount in Mahindra & Mahindra shares, the financial outcome would be different. In September 2019, Mahindra & Mahindra shares were priced at around Rs 550. Today, the stock trades at over Rs 1,400.
So, with an initial investment of Rs 20 lakh, you would have acquired approximately 3,636 shares. The current value of these shares would be more than Rs 50 lakh. Although not as dramatic as the Tata Motors example, the significant appreciation still highlights the benefits of stock investments.
Post-COVID Success of Automakers
For many, the COVID-19 pandemic period brought in financial instability, and many lost their jobs and suffered losses. This was also true for the automobile industry as well. However, as the economy recovered, the demand for personal vehicles surged. This, in particular, helped in automakers growing their brands at a rapid pace.
This particular shift in market trend, when combined with strategic product launches and increased production capacities, helped major automakers. The rise in their stock prices actually reflects investor confidence and the companies’ strong performance in going through the post-pandemic landscape.
Should you regret your decision?
Well, the answer to this is subjective. However, what we think is that cars are mostly emotional and necessary purchases for average Indian car buyers. So, when you are about to sign a check for your car’s payment, you are paying for the convenience and happiness that it brings to you.
So, if you made that decision to buy that car a while ago and you are happy with your vehicle, we would say that was money well spent. As for the investment side, what’s gone has gone, and you can now start again by investing whatever you can, and we are sure that one day you’ll not regret these small savings and investments.