Passenger Vehicles
The analysts are also expecting a favorable performance in terms of volume growth from the Passenger Vehicle (PV) sector.
Sharekhan expects its “domestic PV universe to register 26.9% growth in volumes on m-o-m basis.”
Meanwhile Antique expects a moderate single digit growth year-on-year, mainly in the SUV segment, boosted by new product launches.
“Our interaction with dealers indicate the outperformance of SUVs is continuing across brands, while MSIL dealers expect a gradual recovery in the entry-level segment demand as the income levels in Tier1 and 2 cities stabilize,” the broker said.
Analysts from Sharekhan also feel the same regarding the dominance of SUVs. They believe that the price hikes announced by prominent players in the market such as Tata Motors and MSIL, will only help the sector kick in.
“The demand in the PV segment has continued to skew towards the SUV segment and hence the rise in prices would be easily absorbed in the market and supports the profitability of OEMs,” said analysts from Sharekhan.
In addition, analysts from Antique expect the PV wholesale side to show better performance in January, considering the filling of new stocks in stores following the sweeping sales during the festive season.
At the same time, on the retail side also, traction remains strong, with “channel checks indicating strong traction in states like Gujarat, UP, and Rajasthan, while Maharashtra remains flattish,” noted the broker.