Auto-Ancillary Sector Q3 Earnings Preview: Strong Demand Recovery To Drive Results, Says Nirmal Bang
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Nirmal Bang Report
We expect Q3 FY21 earnings of auto and auto ancillary companies to witness strong YoY growth, driven by V-shape recovery across segments and leaner cost of operations due to cost-cutting measures.
Pent-up demand, increased preference for personal mobility and strong rural sentiments have helped revive the sector.
Tight cost controls and operating leverage benefits are likely to drive Ebitda margins.
However, commodity prices have seen a sharp increase during the quarter and will remain a headwind going forward.
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