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Rating agency Icra has said that domestic Commercial Vehicle (CV) volumes are likely to dip 4-7 per cent year-on-year next fiscal with high base effect kicking in. The volumes are expected to remain muted through the January-March quarter on account of a perceived pause in the infrastructural activities as the model code of conduct kicks in ahead of the general elections. It estimates the domestic CV industry volumes to register 2-5 per cent year-on-year growth in volumes in FY24. 

The agency said it expects the long-term demand for CVs to remain intact. The continued focus on infrastructure capex, emphasis on private participation in infrastructure, construction, defence and manufacturing activities would remain a long-term positive for the CV industry.

However, in the near term, Icra expects the volumes to plateau on a high base, amid the transient moderation in economic activity in some sectors with the onset of the general elections. Overall, it said the domestic CV industry's ability to scale previous peaks hinges on sustenance of the macro-economic environment, improvement in infrastructure activity and increased demand for last mile transportation.