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January volume print: A mixed bag

The auto sector, in January 2025, reported modest wholesale volume growth in PV, CV and 2W segments, led by channel filling after the year change, whereas retail demand showed mixed trends, with PV volumes growing 15% and 2W retail volumes increasing 3% yoy. PV, 2W and CV segment wholesale volumes grew in low-single digits yoy. The tractor segment continued its uptrend, with low-teens yoy growth, whereas EV 2W volumes rose 19% yoy.

Domestic wholesale PV volumes rise in mid-single digits yoy

Based on our estimates, domestic PV industry wholesale volumes in January 2025 increased in mid-single digits yoy, driven by channel filling (seasonality) on the back of normalized inventory levels. Retail sales of the PV industry rose about 15% yoy in January 2025, partly reflecting strong retail trends in the month of December (gets captured with a lag). MSIL’s volumes improved 7% yoy, led by 6%/13% yoy growth in domestic/export volumes. Based on our estimates, MSIL’s wholesale market share stood at about 43.1% (up 80 bps yoy). TTML’s PV volumes declined 11% yoy, whereas M&M’s PV volumes grew 18% yoy in January 2025. HMI reported a 5% yoy decline, while Toyota’s volumes grew 13% yoy in January 2025.

Domestic 2W wholesales grow in low-single digits yoy

Domestic 2W wholesale volumes grew in low-single digits yoy due to a moderation in demand after the festive season, in line with the domestic ICE retail demand trends, with 3% yoy growth in January 2025. EV 2W retail sales rose 19% yoy in January 2025. Export volumes increased in low-single digits on a sequential basis. HMCL’s volumes improved 2% yoy, whereas TVSL’s 2W volumes grew 17% yoy, driven by 52% yoy growth in export volumes and 10% yoy growth in the domestic segment. Royal Enfield’s volumes grew 20% yoy, led by a 79% yoy increase in exports and 15% yoy growth in domestic volumes. BJAUT’s 2W volumes rose 7% yoy, led by a 37% yoy increase in export volumes, partly offset by an 11% yoy decline in domestic volumes.

CV segment volumes remain muted

Domestic CV segment volumes grew in low-single digits yoy due to weak demand trends in the truck segment, partly offset by strong demand trends in the bus segment. TTMT’s domestic CV volumes remained flat yoy, led by (1) a 5% yoy increase in M&HCV trucks, (2) an 18% yoy growth in the bus segment, partly offset by a 15% yoy decline in the SCV segment. AL reported 8% yoy growth in volumes, whereas VECV’s volumes rose by 20% yoy in January 2025

Domestic tractor segment demand remains strong

Based on our estimates, domestic tractor volumes saw low-teens growth yoy in January 2025, led by (1) a strong rabi sowing, aided by higher water storage levels in major reservoirs, and (2) sustained government support. M&M’s tractor volumes grew 15% yoy, whereas Escorts Kubota’s tractor volumes declined 7% yoy in January 2025

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