Auto Sector Update - Chip Shortage To Lead To Another Round Of Earnings Cut: Motilal Oswal
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Motilal Oswal Report
The retail demand evolution has been a mixed bag since the lifting of the second lockdown from mid-June 2021 – demand has bounced back quicker for passenger vehicles, but two-wheelers have seen slower recovery.
While commercial vehicles are expected to see good recovery from October 2021, the outlook for tractors is cautious due to the very high base of last year.
The semi-conductor shortage has intensified with the lockdown in Malaysia from June-21, resulting in a severe crunch in the supply of semi-conductors in the Indian automotive industry.
This could potentially hurt demand for passenger vehicles, premium two-wheelers, and light commercial vehicles during the upcoming festive season.
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