Muthoot Capital Says Confusion Over BS-VI Norms To Hurt Two-Wheeler Sales In Q4
Buyers are hesitant to buy new and costlier two-wheelers complaint with BS-VI norms, Muthoot Capital’s COO Madhu Alexiouse says.
Muthoot Capital Services Ltd., a two-wheeler financing company, expects fewer-than-estimated vehicles to sell in the quarter ending March 2020 as confusion over transition to new emission standards prevails.
“If you ask me how the growth trajectory has to be in the fourth quarter, it would be 40 lakh vehicles sold. It should’ve been 45-48 lakh but we are seeing around 40 lakh two-wheelers may get sold,” Chief Operating Officer Madhu Alexiouse told BloombergQuint in an interview.
In the quarter ended December, 43.18 lakh two-wheelers were sold.
Vehicle sales, according to Alexiouse, will be partly impacted by the 15-day ‘Shraadh’ (mourning) period in January, considered inauspicious for buying. Buyers are also hesitant to buy new and more expensive vehicles that are complaint with Bharat Stage-VI emission norms.
India’s automakers have been struggling to push sales since the 2018 festive season. First, increased upfront insurance costs and higher fuel prices kept buyers away. Then a broader economic slowdown hurt their purchasing power further. Discounts failed to lift demand, forcing automakers to cut production as inventory piled up at dealerships. Last year, the automotive industry saw the worst slump in sales since at least 1997.
Muthoot Capital Q3 Results: Key Highlights (YoY)
- Net interest income rose 9.5 percent to Rs 92.6 crore.
- Profit fell 22.8 percent to Rs 18.95 crore.
Watch | Muthoot Capital Service’s Madhu Alexiouse On His Outlook For Q4