Two-wheeler retail gross sales through the Navratras grew by mid-to-high single digits throughout areas at the same time as rural gross sales have remained muted, a brokerage agency mentioned in a report on the auto sector on Thursday.
The report by Motilal Oswal Monetary Companies additionally mentioned that over the last week of October, inquiries and bookings are seeing a slight enchancment for passenger car OEMs (authentic gear makers) particularly for Maruti Suzuki and Tata Motors.
“We noticed assorted demand developments in October, with two-wheelers and tractors exhibiting optimistic momentum and passenger and industrial automobiles witnessing reasonable demand. A greater monsoon helps drive optimistic sentiment in rural areas, although the sustainability of this demand stays to be seen,” the brokerage agency mentioned.
Total, two-wheelers carried out higher, with festive progress anticipated at 4-5 per cent year-on-year partially constrained by a excessive base, it mentioned.
On the identical time, passenger automobiles might even see a fall within the festive season in comparison with the final yr, it mentioned, including that stock ranges are presently excessive for each two-wheelers and passenger automobiles, making Diwali gross sales a crucial interval to gauge stock clearance.
Tractor volumes are recovering and are anticipated to carry out nicely within the second half of the present monetary yr. In industrial automobiles, sentiment improved sequentially, pushed by demand in sure industries, although a full restoration stays distant, it acknowledged.
Total, the brokerage agency mentioned, it expects dispatch progress for two-wheelers and tractors at 12 per cent and two per cent respectively whereas for the three-wheelers at 5 per cent.
Nevertheless, passenger automobiles are anticipated to see a flat progress in volumes whereas industrial automobiles quantity might even see a 4 per cent year-on-year dip, as per the report.
It famous that the retail gross sales through the Navratras grew by mid to high-single digits throughout areas we interacted. Rural gross sales have remained muted through the Navratras however are anticipated to enhance throughout Diwali, it mentioned that over the last week of the continued month, inquiries and bookings are seeing a slight enchancment for PV OEMs, particularly for Maruti Suzuki and Tata Motors.
In line with the brokerage agency, weak point in industrial car demand endured even through the competition with volumes anticipated to say no by round 5 per cent year-on-year.
Nevertheless, the state of affairs nonetheless appears higher than final month as an enchancment in fleet utilization ranges in a lot of the areas was famous through the month, it acknowledged.
Stating that it noticed enchancment in tractor demand, with volumes anticipated to develop 2-4 per cent year-on-year regardless of the delayed monsoon, the brokerage agency in its report mentioned that key states like Maharashtra, Karnataka, Telangana, and Andhra Pradesh skilled a roughly two-week delay in harvesting resulting from monsoon affect.
Nevertheless, sellers in southern areas have reported encouraging demand restoration in October. Alternatively, demand in northern areas is but to catch up and the identical is predicted to materialize subsequent month, the brokerage agency mentioned.
Moreover, the federal government’s latest MSP improve by round 6 per cent for key crops like wheat, barley, and gram for the subsequent fiscal yr ought to assist optimistic sentiment within the tractor and rural markets, it famous.
