A Hero Honda Motors Ltd. employee lines up motorcycles at a showroom in Mumbai, India. (Photographer: Prashanth Vishwanathan/Bloomberg News)

Brokerages Expect Double-Digit Auto Sales Growth In November 

Indian automakers are expected to report double-digit sales growth in November, according to a BloombergQuint poll of three brokerages.

Maruti Suzuki India Ltd.'s sales are seen rising 15 percent, while rivals Mahindra & Mahindra Ltd., Tata Motors Ltd. and Ashok Leyland Ltd. are all seen clocking sales growth of over 30 percent each. The rise in sales is mainly driven by the low base effect, as consumption slumped in November 2016 after the Narendra Modi government demonetised Rs 500 and Rs 1,000 notes.

Two-wheelers too are expected to clock robust year-on-year sales growth, with Bajaj Auto Ltd. likely to clock 31 percent growth in sales. Market leader Hero MotoCorp Ltd. is likely to lag rivals, with sales rising 18 percent.

Here’s what brokerages had to say:

Motilal Oswal On November Auto Sales

  • Retail momentum mixed for two-wheelers and commercial vehicles; passenger vehicle segment healthy.
  • Healthy wedding season demand partially negated by untimely rains.
  • Demand momentum in rural markets continues to be healthy.
  • Hero outperformed in motorcycles, capitalizing on healthy wedding season demand in North India.
  • Maruti continues to see better retail sales than competitors; Tata too is gaining momentum.
  • Demand for commercial vehicles is not exciting; discounts increased sequentially.
  • Prefer four-wheelers over two-wheelers and commercial vehicles due to stronger volume growth and stable competitive environment.
  • Top picks: Maruti, Bajaj Auto, Tata Motors and Amara Raja.
  • M&M as the best bet for rural market recovery play.

Nomura On November Auto Sales

  • Low base of demonetisation to drive strong growth for medium and heavy commercial vehicles, followed by two-wheelers and passenger vehicles.
  • Expect passenger vehicle industry to report 16 percent year-on-year growth.
  • Maruti to outperform the industry with 17 percent growth.
  • Medium and heavy commercial vehicle segment and two-wheeler segment to grow 34 percent and 24 percent respectively year-on-year.
  • Medium and heavy commercial vehicle segment: Ashok Leyland, Tata Motors and Eicher Motors’ volume to grow 23 percent, 35 percent and 26 percent respectively on a yearly basis.
  • Two-wheeler segment: Hero MotoCorp, Bajaj Auto and Eicher Motors’ volume to grow 21 percent, 35 percent and 27 percent respectively on a yearly basis.

Also Read: Auto Sales Set To Bounce Back To Normal In November: BQ Survey

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