Nirmal Bang: August 2020 Auto Sales Witness Improved Sentiments, Festive Demand Drives Recovery; CVs Struggle

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Nirmal Bang Report.Automobile sales witnessed a further recovery in volume in August 2020 on the back of normalisation in supply chain, strong sentiments from rural and semi urban markets and rise in preference for personal mobility. The tractor segment reported very strong YoY growth on the back of positive rural sentiments (due to increase in Kharif sowing area, thereby indicating bumper harvest, a bountiful monsoon, good rural cash flow). Most original equipment manufacturers (OEMs) reported better-than-expected improvement in sales volume amid recovery in supply chain. Retail sales witnessed sequential improvement but are still much lower than pre-Covid-19 level. Retail sales were also much lower than wholesales for majority of the OEMs (source: Vahaan) due to channel filling by OEMs (as channel inventory remains lower than normal level) amid optimistic demand expectation for the upcoming festive season. According to commentaries from tractor, two-wheeler and passenger vehicle OEMs, retail demand continues to see recovery, especially from rural and semi urban areas. Further ramp up of production and managing supply chain will remain key focus areas going ahead. Three-wheeler volume continues to struggle due to lower demand for shared mobility and issues with availability of financing. The light commercial vehicle segment continues to see good recovery on account of higher demand from e-commerce and for last mile connectivity. The medium and heavy commercial vehicle segment remains the worst affected segment due to weak economic environment and excess capacity. .Click on the attachment to read the full report:.DISCLAIMERThis report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the brokerage and do not represent the views of BloombergQuint..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Nirmal Bang: August 2020 Auto Sales Witness Improved Sentiments, Festive Demand Drives Recovery; CVs Struggle

Nirmal Bang: August 2020 Auto Sales Witness Improved Sentiments, Festive Demand Drives Recovery; CVs Struggle

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