Wholesale growth expected to continue for tractors, passenger vehicles and two-wheelers, says equity research firm Emkay
As per its sectoral update, channel checks indicate better retail sales for tractors and PVs, while it remains subdued for 2Ws on a YoY basis.
"Tractor industry wholesales should grow strongly at more than 25 per cent on better retails and channel filling."
"Volume growth is expected to be positive across regions."
According to the update, PV industry volumes are likely to remain in the positive territory, with industry growth at over 15 per cent.
"Domestic volumes should grow... on a low base which resulted from supply issues present in the year-ago comparable period."
"Discounts have declined YoY - by up to 2 per cent of vehicle prices."
Notably, the update expected domestic 2W volume performance should be mixed YoY.
"Volume performance in South, East and West regions has been better than the North region."
"Retails have declined in the North region due to the weakness in entry-level segment and lower marriage season demand. Executive and premium motorcycles are doing better than entry-level motorcycles. In comparison, exports are expected to be strong across regions, except for the ASEAN market."
AdvertisementIn addition, the update pointed out that domestic CV volumes will be a mixed bag.
"MHCV demand has been improving on strong Tipper or ICV demand and a gradual recovery in replacement demand as well."
"The automobile sector remains a key beneficiary of the economic recovery and low interest rates."
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