Auto sales in November are expected to be a mixed bag — the passenger vehicle segment shall grow in the low single digits while the two-wheeler segment is likely to make a comeback in a big way.
In terms of overall growth for the industry, the two-wheelers’ wholesale segment is expected to grow 25 percent year-on-year while medium and heavy commercial vehicles are expected to rise about 12 percent year-on-year.
The passenger vehicle segment will continue to witness muted growth on the back of slower growth in the small car segment. Hence, overall, just a 5 percent growth is expected in the passenger vehicle space in November.
Tractors wholesales, on the other hand, may grow 13 percent year-on-year.
In terms of stock-wise expectations, Nomura expects 5 percent growth for passenger vehicle makers like Maruti Suzuki.
It expects Bajaj Auto to witness good recovery with 24 percent growth year-on-year. It may be noted that the stock has already hit a fresh high.
Ashok Leyland will also see high double-digit growth.
Hero MotoCorp, meanwhile, has come back because of a good pick-up in the rural market in the two-wheeler space, therefore, a 27 percent growth is likely. TVS Motor, on the other hand, shall see 34 percent growth.
Earlier this month, the Federation of Automobile Dealers Associations (FADA) had pointed out that rural areas particularly contributed to the surge in two-wheeler purchases, which made a comeback during the festive season. Prior to this, the retailers’ association released Navratri sales data, which was the best in six years.
Though the first half of October saw an 8 percent year-on-year (YoY) decline in auto sales due to the Shraddh period, retail sales during Navratri soared 18% annually, surpassing the figures of Navratri 2017, FADA had said in its monthly update on November 6.
FADA also reiterated its caution on high inventory levels in the passenger vehicles (PVs) segment, which it earlier said demands urgent attention from OEMs.