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Sales of passenger vehicles (PV), commercial vehicles (CV) in January 2023 are expected to be good as per its channel checks, said Emkay Global Financial Services.

According to Emkay Global, it had conducted a channel check to gauge the volumes' estimate for the month of January.

The channel checks indicate PV volumes to be higher on healthy order book and ramp-up in production. Further, CVs are likely to maintain their double-digit growth momentum on better freight availability.

In addition, tractor volumes are likely to be better on improving customer sentiments and finance availability. Lastly, two wheelers volume growth is expected to be positive, supported by festive season (Uttarayan) and marriage season demand, Emkay Global said.

According to Emkay Global's report, the PV industry's volumes should witness robust growth (about 12 per cent year-on-year- YoY) on account of a large order book and higher production. Uncertainties remain on the supply chain, but production is improving in a staggered manner.

Emkay Global's channel checks indicate that dealer inventories are notably below normal levels. Among OEMs, they estimate domestic volumes to grow by 55 per cent YoY for M&M, 10 per cent for Tata Motors, and 8 per cent for Maruti Suzuki.

Blended vehicle discounts have been reduced on MoM basis due to seasonality and remain lower than the peak levels seen in the past.

The CV players' volumes should grow in double digits (about 13 per cent YoY) with robust demand in both passenger and cargo segments.

Transporters are buying trucks to get GST input credit and preponing purchases before the implementation of real driving emission (RDE)/On Board Diagnostic 2 norms. Emkay Global expects 49 per cent YoY growth for Eicher Motor-Volve Eicher Commercial Vehicle, 41 per cent for Ashok Leyland, 6 per cent for Tata Motors, and 4 per cent for M&M in the domestic market.

As regards the two wheelers industry, the volumes are expected to improve (about 7 per cent YoY), Emkay Global said.

The channel checks indicate that demand in the festive season and marriage season aided two wheelers' volumes in the latter part of the month, post the commencement of the auspicious period.

According to Emkay Global, vehicle makers are going slow on dispatches as model-changeovers are happening due to OBD2. Emkay Global expects domestic volumes to improve by 29 per cent for Eicher Motor-Royal Enfield, 16 per cent for TVS Motor, 8 per cent for Hero Moto Corp Ltd, and 2 per cent for Bajaj Auto.

The tractor industry's volumes are likely to register strong growth (about 13 per cent YoY) on improving customer segments and better finance availability, Emkay Global said.

Crop prices are better YoY in the wholesale market for rice, wheat, and tur dal, among others. Minimum support prices (MSPs) are also better YoY, and government procurements are happening in proximity to farmers, resulting in lower logistics costs. Emkay Global expects double-digit growth in domestic volumes, at 18 per cent YoY for Escorts and 15 per cent for M&M.