Antique | Auto sales volume review – 231102

Antique | Auto sales volume review – 231102

Strong dispatches indicate bumper festive demand

Overall, auto OEMs reported an encouraging set of numbers posting strong growth across segments, barring tractors, thus far this festive season. Retail sales have been strong in the latter half of October during Navratri. In anticipation of a strong festive season, we were expecting a strong uptick in dispatches as OEMs fill up the channel ahead of the festivals. PV/ 2W/ CV volumes came in strong, posting volume growth of ~18%/ 22%/13% YoY and were ahead of our expectations. In PVs, MSIL came as a surprise posting a growth of 19%/ 10% YoY/ MoM largely due to a very strong response to Fronx, Jimny, and Grand Vitara. SUV volume grew 91% YoY for MSIL. For Tamo, PV growth was largely led by the new Nexon and EVs.

In CVs, AL/ VECV growth came in strong at 14%/ 24% YoY against 4% YoY growth for Tamo. Our channel checks also indicate AL gaining strong traction in northern markets. The LCV segment also saw a marginal recovery in volumes for all the players in the month of October. In 2Ws, volume came in ahead of our estimates led by a broad-based recovery in the segment. Hero’s volumes came in very strong at 574k units, a growth of ~27% YoY. HMCL has also been pushing the inventory aggressively and is ahead of the competition in running schemes during the festival season. It has introduced cash discounts of ~4-5.5k on HF Deluxe across the country, which has received a good response. TVS & Bajaj volumes also are seeing good recovery both in the rural and urban markets led by positive sentiments and favorable finance schemes.

Exports continue to remain under pressure on a YoY basis, especially for Bajaj Auto, however, sequentially we see a marginal recovery. Inventory across players continues to remain at comfortable levels ahead of the festivals at ~55-60 days. HMCL has the highest inventory. Tractor dispatches declined 4% on a YoY basis as demand is impacted due to lower rainfall and delayed harvest.