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Informist, Friday, Nov. 29, 2024

 

MUMBAI – The commercial vehicle segment is likely to have grown at a robust pace in November, while other segments may have remained subdued, said analysts ahead of the release of the wholesale automobile sales data for the month. While Nuvama Institutional Equities expects sales volume of passenger vehicles to remain flat on year, Nomura has pencilled in a growth of 2% on year in the segment in November. However, both firms noted that the comparison is on a high base, as a notable portion of the festival period was in November last year.

 

Nomura said retail sales of passenger vehicles are expected to decline 14% in November as per the registration data. Nuvama and Nomura expect Mahindra and Mahindra Ltd., and Maruti Suzuki India Ltd. to drive the passenger vehicles' volume growth for November. Nomura expects M&M's automobile business to post a 15% on-year growth in its total volume across markets, led by a 13% growth in its utility vehicles' volume, due to the production ramp-up of its newly launched 'Thar ROXX' and 'XUV 3XO'. Nomura said the company's newly launched electric vehicles BEV 6e and XEV 9e can push sales volume by 3,000 units per month, with a potential to further increase this up to 5,000 to 6,000 units.

Nuvama and Nomura's estimates for Maruti Suzuki India's overall volume varied significantly. Nomura expects a 9% volume growth, while Nuvama expects sees only a 2% volume growth for the month. While Nuvama expects Tata Motor's passenger vehicle segment's volume to remain flat on year, Nomura expects it to fall 7% in the domestic market. Nuvama said Hyundai Motor India Ltd. will likely post flat volume growth for November. However, Nomura expects Hyundai's sales volume to fall 2.7% on year for the month. Blended discounts remain high as car makers are trying to support demand, the brokerage said. 

 

While Nuvama expects two-wheelers' wholesale domestic volumes to fall 3% on year due to inventory de-stocking with dealers, Nomura sees it rising 3% on year during the month. Although surveys have indicated slowing demand trends in the two-wheeler industry, positive rural sentiment is expected to support the overall growth in the segment, Nomura said. While Nuvama expects a fall in the domestic volume for two-wheeler companies, it sees exports growing in double digits due to growth in Latin America, Africa, and Asia regions.

 

Both brokerages expect sales volume of Royal Enfield's to grow around 3% on year in November, but see Hero MotoCorp's volume falling to 3-4% from a year ago. Nomura expects TVS Motors' overall volume to grow 8.6?ross markets, while Nuvama sees a growth of 6%. While Nuvama said Bajaj Auto's overall volume is likely to fall 1% during November, Nomura sees it rising 6%.

 

Tractor sales volume may have been subdued during November due to high base and inventory de-stocking with dealers, said Nuvama. The brokerage said the overall sales volume for tractors will likely fall 1% in the domestic market. However, Nomura expects tractor sales volume to have risen 10% on year during the month, supported by good rainfall, good reservoir levels, crop prices, and improved rural sentiment. Nuvama sees Escorts Kubota's total volume down 2% on year and M&M's tractors' volume down 1% for November.

 

Nuvama expects Ashok Leyland's total volume for November to grow 10%, but Nomura sees it growing just 2%. Tata Motors's commercial vehicle segment's volume is expected to grow 8% on year, and Eicher Motors' commercial vehicles' sales volume is expected to grow 6% on year, Nuvama said. Nomura, on the other hand, said Eicher Motor's commercial vehicle segment's sales volume will likely grow 23% on year during November.

 

All commercial vehicle makers are expected to post a good performance, with a pickup in infrastructural activity, Nuvama said. Higher electronic waybills for November compared to a year ago indicate better freight availability for transporters during the month, it added. The electronic waybill system is a document which gives details related to the movement of goods and has to be carried by transporters for consignments exceeding the value of INR 50,000. Nuvama said 3.8 million total waybills were generated in October, but did not mention the number of waybills generated so far this month.  End

 

Reported by Aman Aryan

Edited by Deepshikha Bhardwaj

 

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