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MOSL: Morning India (29/June/21): 1. AUTOS (Jun-21 Channel Checks - PV/Tractor recovery strong; CVs slow and 2W weakest); 2. Nalco; 3. Bandhan Bank; 4. Financials; 5. EcoScope

MOrning India (29/June/21):

Today’s top research idea

AUTOS: Jun-21 Channel Checks - PV/Tractor recovery strong; CVs slow and 2W weakest

• Our interaction with leading industry channel partners reflects mixed sentiment of optimism and uncertainty. Most of the markets were open for 15-20 days in Jun-21.
• PVs and Tractors (+6% CAGR over Jun-19) are the only segments where volumes are higher than 2019 levels, whereas all other segments are materially lower (15-38% CAGR decline) than Jun-19.
• 2Ws are worst impacted as second wave has affected the rural and semi-urban markets. Rising fuel prices has further acted as a dampener to the demand as a result enquiry level has not picked up as expected. Inventory remains high at 45-60 days.
• PVs: This segment is better-off then other categories. Enquiry levels recovered to range of 70-80% compared to Jan-Feb'21. The demand for CNG vehicle remains strong however supply chain issues (CNG kit and chips) has increased waiting period of CNG vehicles. MSIL comes out to be major beneficiary of increase in CNG model demand.
• CVs: Dealers are expecting demand recovery to take place towards the end of 2QFY22 as infrastructure demand is low due to monsoon while cargo demand is still very low. Financiers are quiet aggressive in funding any demand and LTV is stable around 85-90%.

  Piping hot news

  Fiscal impact of fresh stimulus package under 1% of GDP: Experts

  The fiscal impact of the relief measures announced by finance minister Nirmala Sitharaman was likely to be less than 1% of gross domestic product (GDP), experts have said. Sitharaman announced a host of relief measures on Monday, targeting various sectors of the economy, some of which included fresh public spending while others were measures that were either previously announced or budgeted for. These included Rs 1.1 lakh crore loan guarantee schemes for Covid-affected sectors, Rs 97,631 crore Centre’s component in a reform-linked power sector schemes, and Rs 93,869 crore for extending the free food grains scheme till November.