MOSL: Morning India (26/March/18): 1. Automobiles; 2. Telecom
MOrning India (26/March/18): 1. Automobiles; 2. Telecom
Today’s top research idea
Automobiles: Continued demand momentum across segments
Our interactions with leading channel partners indicate continued demand momentum across segments in Mar’18, supported by festive demand in key markets.
- CVs: CVs will continue to see healthy wholesales, on a high base of last year, as demand continues to outstrip supply. We also note a sequential decline in discounts on CVs for the second straight month.
- PVs: PV retails are healthy, led by MSIL. New Swift bookings are at ~95k units, with average waiting period of ~3.5 months. Waiting period for Baleno/Brezza has declined, with improving supply. MM's retails are growing at 8-10% in rural regions.
- 2Ws: Demand for 100-125cc motorcycles remains robust, with average retails growing more than 15%. HMCL is witnessing strong sales in rural markets. TVSL has raised Star City ES prices by INR500, while BJAUT has slashed Pulsar 150 prices by INR3k.
- 3Ws: Demand for 3Ws is normalizing in Maharashtra (35% of passenger 3W market) after fulfillment of pent-up demand post removal of cap on permit issuance.
- We prefer PVs over 2Ws and CVs due to stronger volume growth and a stable competitive environment. Our top picks: MSIL and MSS among large caps, and AL and EXID among midcaps.
Piping hot news
FPIs turn positive on Indian equities; pump in Rs 8,400 crore in March
- Foreign investors have infused over Rs 8,400 crore in the the Indian equity markets so far in March on expectations of rebound in corporate earnings and easing of global oil prices. However, they pulled out nearly Rs 10,000 crore from the debt markets during the period under review, depositories data showed.
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