Automobile Sales - October 2012 - Eastern Financiers

Sales for the automobile sector witnessed steady set of numbers during the festive October month amid improved sentiment led by the big bang reforms. Sales for the sector has been murky in the recent past led by hike in fuel price and the escalated cost of funds.

Bajaj Auto that recorded its highest ever domestic motorcycles sales during October 2012, witnessed growth of 3.99% with 411052 units being sold equated to 395274 units sold in October last fiscal after marking persistently murky performance in the preceding months, which may be attributed to the arrival of the festive season and improved sentiment for the sector. Total Motorcycle sales of the company stood at 361186 units in October this year, marginally higher than the performance during October last year when it sold 3,51,083 units, an increase of 2.88%.

Maruti Suzuki India that witnessed a horrendous month of October 2011 with unrest at its Manesar plant-reported astounding performance this October marking massive growth of 85.46% which may be attributed to the normal environment at its Manesar plant, new launches and the initiation of the festive season with well stocked dealership ahead of it. Sales for the company retrieved sharply almost across all the segments on regular working of the Manesar plant. The company reported total sales of 103108 units in October 2012 against 55595 units in the same month last fiscal. On a monthly basis the company witnessed surge in sales of 9.70% with 93988 units being sold in September 2012.

Hero MotoCorp, the company that marked de-growth during the preceding months of July, August and September 2012 amid challenging environment where rising petrol prices and high interest rates affected retail sales in the rural and urban areas-recuperated during the month of October marking escalation in sales, with sales of above 5 lakh units at 529215 units against 512238 units being sold in October last fiscal, observing growth of 3.31% led by the arrival of the festive season.

India's second largest commercial vehicle maker Ashok Leyland reported 27.91% year-on-year rise in October sales at 7997 units, as continued strong demand for its light truck Dost helped cushion the bumpy ride of heavy trucks. The Hinduja group company sold 3033 units of the Dost SCV (small commercial vehicle), which was launched in September last year. Excluding the Dost, Ashok Leyland's CV sales declined 12.53% to 4964 units against last October that sold 5675 units.

Reporting the highest ever monthly sales, total sales of India's leading sports utility vehicle manufacturer, Mahindra & Mahindra propelled by 28.75% with 53438 units being sold during the month of October 2012 against 41506 units sold in October last fiscal, after clocking the all time high monthly sales during the preceding month of September 2012. However, the farm equipment sector of the company continued to clock de-growth of 7.14% marking sales of 29565 units as against 31838 units being sold in October last year. The overall growth of the company, including the farm equipment sector slightly edged up by 13.17% with sales of 83003 units in October 2012 equated to 73344 units sold in October 2011.

Aided by strong demand in the light commercial vehicle division, total sales for Tata Motors during October 2012 impelled 5.53% with sales of 71771 units against 68008 units being sold in October 2011, followed by prior month's fall of 3.82% during September 2012. Total sales of the company, compared to the preceding month of September 2012, in which it sold 75773 units, sales edged lower by 5.28%.

Attributed by total two wheeler and three wheeler sales, total sales of TVS Motors Company recuperated during the festive October season marking sales growth of 3.66% with 190438 units being sold in October against 183718 units sold in the same month last fiscal after marking consecutive months of murky sales in the preceding months. Overall Sales slithered during September to the tune of 22.46% followed by prior months down tick of 20.65%, 15.11% and 7.54% during August, July and June respectively. Sales when compared to the preceding month of September 2012, augmented 11.96% with 170097 units being sold during the month.

The festive mood perked up the performance for the sector during October that was restrained in the midst of weak consumer sentiment led by high inflation, escalated cost of funds and trek in fuel prices. Despite of the ongoing market challenges, auto companies that reported beefy set of numerals during October 2012, is expected to stage healthy performance during the festive November month too.

Source : Equity Bulls

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