Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel https://t.me/InvestmentGuruIndia
Download Telegram App before Joining the Channel
Dispatches crater amidst BS-VI transition, lockdown
Two-wheeler (2W): Incentives aid BS-IV liquidation but dispatches suffer
* Hero MotoCorp (Hero) has reported a decline of 42% YoY to ~334k units in Mar’20. Domestic scooter volumes were down 37% YoY at 28.7k units and motorcycles slump 43% at ~306k units. Hero stopped producing BS-IV scooters in Jan and motorcycles in mid-Feb, provided Rs10k/Rs15k per motorcycle/scooter to support dealers clear BS-IV inventory. However, due to the sovereign lockdown in 3rd week of Mar’20, industry could not continue BS-VI dispatches, thus leading to the decline.
* TVS Motors (TVSM) also reported 56% YoY decline to ~145k units in Mar’20. Domestic sales declined 62% YoY to ~94k units while exports were down 34% YoY to ~50k units. On a segmental level, motorcycle sales growth declined 53% to ~66k units and that for scooter/moped fell 65%/54% YoY to ~34k/~33k units. The 3W segment declined 26% YoY registering sales of ~10.7k units.
* Royal Enfield has reported a decline of 41% YoY to ~35.8k units. Motorcycle sales under 350cc segment declined 45% YoY to ~30k units and exports grew 33% YoY to ~3.2k units. While RE has liquidated its BS-IV inventory, the fall is largely due to subdued sales in 350cc products while twins continue to perform better.
Passenger vehicles (PVs): Lower production eases transition
* Maruti Suzuki’s (Maruti) volumes dropped 47% YoY to ~84k units, with the minivehicle segment down 5% YoY to ~16k units (aided by recently launched S-Presso model), while compact segment dropped 51% YoY to ~41k units. Ciaz volumes halved at 49% to just 1.8k units. UV segment volumes slumped 54% YoY at ~12k units due to BS-VI transition and COVID-19 related shutdown. PV segment growth was further stifled by weakness in van segment, which was down 64% YoY to ~6k units. Dispatches to Toyota remained steady at 2.1k units (FY20: ~25k units/~2% of domestic volumes). However, exports dropped 55% to ~4.7k units.
* Mahindra & Mahindra’s (Mahindra) volumes nosedived 75% YoY to ~21k units with PV segment dropping 85% YoY to ~273 units and UV segment volume dropping 88% YoY to ~3.1k units. UV segment, impacted BS-VI transition and competitive pressure from new OEMs like Kia and MG Motors.
* Hyundai’s domestic volumes were down 41% YoY to 26.3k units while exports decline 64% YoY to ~6k units. The company has recently launched 2ndGen Creta and has i10 Nios, Aura, and Venue models available on BS-VI.
* Tata Motors’ domestic volumes dropped 68% to 5.6k units. PC volumes declined 73% YoY to ~2.4k units while UV sales declined 64% YoY to ~3.3k units. The company is witnessing relative better demand for models like Altroz and Nexon.
* Kia Motors’ has reported a drop of 45% MoM at 8.58k units, (highest monthly sales volume at ~15.5k units in Feb’20). Overall FY20 sales stood at ~84k units. The company sold 7,466 units of Seltos and 1,117 units of Carnival (recently launched).
* MG Motors’ Hector, launched in Jul’19, and recently launched eZS are growing steadily with FY20-YTD sales at 22k units, with sales up 10% MoM to ~1.5k units.
* Honda’s volumes slumped 79% YoY at ~3.7k units, with UV segment reporting negligible sales of 167 units.
To Read Complete Report & Disclaimer Click Here
For More ICICI Securities Disclaimer http://www.icicisecurities.com/AboutUs/?ReportID=10445
Above views are of the author and not of the website kindly read disclaimer