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Axis Securities Report
We expect auto original equipment manufacturers under our coverage to post revenue/Ebitda/profit after tax growth of 17%/34%/33% YoY in Q3 FY24. This will be led by-
Sales growth in the two-wheeler segment (up ~19% YoY); domestic passenger vehicle segment (8-10% YoY); domestic commercial vehicle segment (4%), and domestic three-wheeler segment (23%); this, however, will be partly offset by a 4-6% YoY drop in the domestic tractor sales volumes,
Higher average selling price on a YoY basis, led by price hikes undertaken by OEMs over the year and richer mix,
Correction in the raw material prices over the high base of the last year as commodity prices are down on a YoY basis. This will lead to higher Ebitda margins (up ~172 bps YoY).
On a sequential basis, we expect auto OEMs under our coverage to register de-growth of 2%/7%/8% in revenue/Ebitda/profit after tax and Ebitda margin contraction of ~72 bps on a QoQ basis.
This will be led by sequential growth of 4%/15% in two-wheeler/tractor domestic sales volumes in Q3 FY24, which, however, will be partly offset by 6%/5%/7% de-growth in passenger vehicle/commercial vehicle/three-wheeler domestic sales volume.
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