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Sector performance

The month of August was a mixed bag again for the auto companies. 2Ws posted weak domestic performance as sales decline for Bajaj Auto in the domestic markets at 31% yoy, while sequentially they grew by 13.3%. TVS posted 5-6% growth in the month, both on yoy and mom basis. 2W exports have shown some signs of improvement sequentially as well as yoy, which can be an important parameter to trace the going forward. This growth was in lower single to lower negative single digit for both TVS and Bajaj Auto after huge negative growths witnessed over the last one year. On the PV front, all the companies have posted strong growth led by the SUV growth story. On the CV side of the sector, we witnessed Tata Motors posting a good growth, while Ashok Leyland posting deep negative falls both yoy and mom.

Company wise performance

Among the PV OEMs, MSIL has posted slightly strong number at 1.89 lakhs. On a yoy basis, the total sales in the domestic markets came in at 15.4% while the exports grew by 14.6%. The domestic growth came on the back of the successful launch of Invicto, Fronx and Jimny 5 door SUV in the last few months. The continued success of the twin launches of new Granda Vitarra and Brezza in the earlier months initiated the growth in the SUV segment earlier. Also the easing up of chip shortage led to catering of the pent up demand. Small cars in August de-grew by 44.9% yoy and were up by 27.3% mom. The compact car segment was up 1.2% yoy and 8% mom. The UV segment grew 118% yoy and dipped by 5.3% sequentially.

TaMo’s PV segment saw a 3% yoy and 3.6% dip sequentially. M&M’s SUV segment on the other hand, jumped by 26.3% yoy and 2.9% mom. CV division was up 9.9% yoy and 13% mom despite the impact of BS VI Phase-2 implementation and OBD-2 norms. M&M’s tractor business in the domestic markets rose by 2.5% yoy and dropped by 14.6% mom. However, Escorts Kubota’s domestic tractor sales dropped 2.1% yoy and grew by 0.8% mom. With below normal monsoon till date due to poor August rains, tractor sales may get impacted negatively in FY 24E.

In 2W segment Bajaj reported a growth of 31% yoy fall and 13.3% mom gain for its domestic motorcycles while in exports, motorcycles improved by growing at 2% yoy and de-grew by 2.1% mom. This sequential growth is a positive sign indicating exports may have bottomed out. However, we need to follow this trend closely in the ensuing months. Their 3W segment moved up by 22.9% yoy and 11% mom domestically on a good pick up in the CNG portfolio and e-3Ws. Exports 3Ws however disappointed by posting a de-growth of 47% yoy and 10.2% mom. Hero Motocorp is yet to post its August sales numbers.

TVS 2W segment reported 5.3% yoy growth of which motorcycle segment de-grew by 2.6% yoy and fell by 0.6% mom, while scooters grew by 16.9% yoy, on highest e-scooter I-Qube sales (23.9K in June v/s 4.4K units in August 22). The sales seemed to have grown despite the impact of FAME-2 subsidy. Mopeds segment of TVS remained flat both mom and yoy. 3Ws fell 24.7% yoy and remained flattish mom.

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