August Auto Sales - Demand Recovery On Track; Supply Issues Ahead Of Festivals To Affect Stocking: Nirmal Bang
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Nirmal Bang Report
Based on our channel checks, we expect August 2021 sales to post positive YoY growth across segments, driven by easing of lockdown restrictions and pent-up demand.
We note that underlying demand trends are strong, with inquiry levels witnessing a sustained pick-up across most segments.
We expect demand recovery to accelerate in the coming months on the back of improving consumer sentiments, faster rollout of vaccination and pick-up in economic activities.
However, our channel checks indicate that persistent supply chain constraints (semi-conductor shortages) will affect production, which could eventually slow down the recovery trajectory.
A prolonged chip-shortage could eventually affect stocking ahead of festivals (especially for passenger vehicles) and adversely impact demand revival (pertinent for two-wheelers).
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