Auto Sales - June 2020 - Acuité Ratings & Research

Suman Chowdhury, Chief Analytical Officer, Acuité Ratings & Research, on the auto sales, June 2020:

"In the backdrop of a protracted national lockdown that continued for over two months followed by further lockdowns in key economic hubs of the country, year-on-year comparison of domestic automotive sales does not throw up any meaningful narrative. It is good to note that most of the vehicle manufacturers including Maruti Suzuki have reported factory despatches that are 2-3 times over the volumes of May, indicating that both supply and demand are gradually gathering some momentum with the easing of lockdown. For the two wheeler segment, the volumes have quadrupled for Hero Motor Corp in June month on month which reflects better consumption demand coming in from the rural and the semi-urban areas due to a healthy growth in the agricultural sector. What is further noteworthy is the positive uptick in tractor demand as seen in a yoy volume growth of 12% and 23% in the domestic sales of Mahindra and Escorts. Acuité believes that current sales of two and four wheelers is also partly driven by the lack of availability of the public transportation system and the perceived contagion risks therein in most of the large cities."

Source : Equity Bulls

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