Commercial vehicles, two-wheelers’ sales positively ‘surprise’ analysts 

Analysts were surprised by sales momentum in two segments in September – commercial vehicles and SUVs – even as other segments saw tepid demand. 
For representational purposes (File Photo | PTI)
For representational purposes (File Photo | PTI)

Commercial vehicles were the stand-out performer, with an 11% year-on-year growth in sales. 

“According to our estimate, the CV segment’s volumes grew low double-digits yoy owing to a strong performance in the MHCV and passenger carrier segments,” said analysts from Kotak Institutional Equities. 
In the CV segment, the Medium and Heavy Commercial Vehicle (MHCV) volume growth was 23.5% year-on-year while Light Commercial Vehicles (LCV) sales remained flat year-on-year. 

The biggest player in the segment, Tata Motors, saw a 13% year-on-year increase in its CV sales in September. 

The increase in the segment was attributed to a 45% year-on-year increase in the M&HCV segment, a 46%  year-on-year improvement in the buses segment and a 2% year-on-year improvement in I&LCV, partly offset by a 6% yoy decline in the SCV cargo segment. 

However, Tata Motors’s passenger vehicle sales fell 6% yoy to 45,300 units. 

But, said Motilal Oswal, this was part of the introduction of new models in Nexon and Nexon EV.

Meanwhile, September was a month of comeback for the biggest player in the passenger vehicle segment – Maruti Suzuki, which regained some of its lost market share during the month.

"According to our estimates, Maruti Suzuki’s market share stood at nearly 41.5% (wholesales) in September 2023," noted Kotak Institutional Equities. The automaker saw a 3% YoY increase in sales to 1.8 lakh units.

Maruti Suzuki owed much of this transition to strong sales of its utility vehicles. 

“Demand for UVs remained strong but entry-level models continue to display weakness for PVs; overall growth was 4% YoY,” said Kotak Institutional Equities, “Domestic wholesales improved by 3% year-on-year and we expect this trend to sustain as we are entering peak festival season and inventory levels remain healthy at 6-7 weeks.”

Even, Mahindra and Mahindra, which reported a 15% growth in its September UV sales, was bullish on demand, analysts noted.

“As per the management, the demand for its SUVs remains strong and it is monitoring supplies of semi-conductors and select components to meet the strong festive demand,” said Motilal Oswal. 
Two wheelers

Meanwhile, September turned out to be pretty decent for the two-wheeler segment with a 22% year-on-year increase in volumes, which was led by sustained outperformance of the premium segment and a base effect, noted Kotak Institutional Equities. 

Wholesale volumes broadly grew in low single digits y-o-y in September.

“Domestic wholesales improved 3% YoY and we expect this trend to sustain as we are entering peak festival season and inventory levels remain healthy at 6-7 weeks,” noted analysts from Motilal Oswal. 

Among the manufacturers, TVS Motors reported a 6% y-o-y rise in volumes, led by 8-10%  growth in motorcycles and scooters. Hero Motors reported a 4% growth. 

Royal Enfield’s turned out to be the odd one of the group as its volumes declined 4% on the year. While Bajaj Auto reported flattish volume growth at 4%.

Tractor sales

Even as tractor segment sales were disappointing, the analysts were optimistic that improved rainfall, increased Kharif sowing, upcoming festive season and better terms of trade should drive a recovery in the coming months. 

The tractor segment emerged to be the most disappointing as volumes declined 11% year-on-year during September 2023. 

“The tractor segment’s volumes remained weak, mainly owing to the weak monsoon in August,” noted analysts from Kotak Institutional Equities.  


The export demand trends remained weak in September 2023 and grew by 5% year-on-year on a low base. 

“Recovery in the export segment remains below expectations, especially in the 2W and tractor
segments,” noted analysts from Kotak Institutional Equities. 

TVS exports showed an 11% year-on-year growth as it has seen both retails and dispatches improving in export markets.

Royal Enfiled reported a 49% year-on-year decline in export volumes. The company which saw an average sales of 6.8k units in the June quarter of FY 2024 saw its exports volumes dip to 4.3k units. 

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