BUY OR SELL-Can Martinrea keep its rally amid GM bankruptcy?

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By R. Manikandan and Bhaswati Mukhopadhyay

BANGALORE, June 4 (Reuters) - Shares of Canadian auto parts maker Martinrea International Inc (MRE.TO: Quote, Profile, Research) have more than doubled over the last six months on hopes the worst may be over for the auto industry and sales may start to pick up later in the year. The stock, which had traded as high as C$12.72 in early 2008, slumped to low of C$1.51 in December as the economic downturn weighed on the auto industry, but it has rebounded since as investors "realize the outcome may not be as disastrous".

Martinrea, which makes metal parts and fluid management systems for the automotive sector, gets about 80 percent of its revenue from the Detroit's Big 3.The company has operations in Canada, Mexico, Europe and the United States.

Most analysts feel the bankruptcies of General Motors GMGMQ.PK and Chrysler do not indicate an end of opportunities for Martinrea.

Analysts also expect light vehicle production volumes to rebound in the second half of the year, and that would help the company to weather the downturn.

However, one analyst said the bankruptcies of the auto majors will hurt Martinrea in the near term.

So, does the stock provide a good entry point for investors?

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