Automobiles Q4 Results Preview - OEMS Continue To Deliver Robust Growth Performance: Axis Securities

Axis Securities Report

The growth drivers for the sector remain positive, particularly in the two-wheeler segment, where expectations of favourable monsoons, the marriage season, revival in rural demand, and exports will play crucial roles in H1 FY25 and beyond.

Passenger vehicle sales are expected to moderate on a high base, while new product launches from certain original equipment manufacturers in the SUV segment by mid-FY25 are anticipated to drive growth, although sluggish demand may persist for entry-level vehicles.

For commercial vehicles, increased government spending on infrastructure post-elections is expected to be favourable in the long term; however, in the near term, we anticipate flat to low-single-digit growth due to the prevailing high base.

Tractor volumes witnessed an early double-digit decline in FY24 and may continue to see similar trends in the near term leading up to elections.

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