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MOSL: AUTOMOBILES | Nov’18 Wholesales-CVs, 2Ws in line-PVs above est Liquidity crunch, non-easy availability of finance impacting retail

AUTOMOBILES | Nov’18 Wholesales: CVs, 2Ws in line; PVs above est.; Liquidity crunch, non-easy availability of finance impacting retail

 

• Improving buying sentiment due to the recent fuel price decline failed to boost Nov'18 wholesale volume. Inventory correction continued across segments. In PVs, dispatches of MSIL declined 0.7% YoY, while in 2Ws HMCL's dispatches grew by a meagre 0.8% (-17% MoM). CV dispatches showed initial signs of weakening demand and were lower by 13-20% MoM, partly led by cyclicality, finance and liquidity constraints. On YoY basis, sales declined by 4% in CVs. Key highlights from Nov'18 wholesale volumes (including exports):
• New product launch drives sales in PVs: Negative sentiment influenced by increase in financing and insurance cost impacted PV volumes, which grew marginally by 1.5% I Nov'18. However, new product launches helped players like MSIL (new Ertiga) and MM (Marazzo and Alturas G4).
• CVs witness second month of weak sales YTD FY19: CV wholesales were impacted in Nov'18 led by liquidity and financing constraints. LCV volumes grew by 8.8% MoM. On YoY basis too M&HCV sales declined 13.6%. TTMT's CV sales declined 5% YoY (13% MoM) to 38k units (in-line).
• 2Ws - HMCL reported marginal increase YoY: HMCL's Nov'18 volume increased marginally by 0.8% YoY (-17% MoM) to 610k units. Oct'18 volumes witnessed inventory correction due to muted retail as rise in insurance cost impacted buying sentiments.