Auto OEM Monthly Preview - Sailing Through Tough Times: Dolat Capital

Auto body parts wait to be shipped in Warren, Michigan, U.S. (Photographer: Jeff Kowalsky/Bloomberg).

Auto OEM Monthly Preview - Sailing Through Tough Times: Dolat Capital

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Dolat Capital Report

Our interaction with dealers and financers suggests that retail sales are under severe stress across the auto segments.

The high inventory with dealers, Covid-19 led lockdown coupled with low retail sales, has increased dealer funding requirement.

Original equipment manufacturers and financers are providing adequate support to their dealers to mitigate tight funding conditions.

Wholesale dispatches are expected to see sharp decline in May 2021 led by-

1. Covid-19 led lockdown in most of the states (70-75% dealership are closed or partially operating) and

2. production and supply side challenges (most of the OEMs announces plant shutdown for 15-20 days).

Increasing vaccination and easing lockdown restriction will help in recovery from June end onwards.

Click on the attachment to read the full report:

Dolat Capital Auto OEM Monthly Preview - May_2021.pdf

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