Auto Q1 Preview - Covid 2.0 Led Lockdowns, Commodity Cost Inflation Dent Earnings: Axis Securities
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Axis Securities Report
After a strong recovery in the second half of FY21, the auto demand was impacted in Q1 FY22 due to the lockdown restrictions imposed in response to the second Covid-19 wave and consequent demand disruptions.
Q1 FY21, too, was impacted in a similar way, thereby making a YoY comparison unviable.
The strong sales growth momentum was decimated during the quarter due to the lockdown restrictions across states.
The volumes started to rebound in June 2021 led by robust pent-up demand post-economic reopening and lower base effect.
With easing lockdowns, retail sales seem to be coming back, albeit gradually.
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