Automobiles Q3 Results Preview - Post-Festive Demand Scenario Weak For Two-Wheelers, PVs: Prabhudas Lilladher
We believe that premiumisation trend will continue to play out across segments.
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Prabhudas Lilladher Report
In Q3 FY23, auto industry witnessed overall volume decline (YoY) owing to weak demand situation post festive season and inventory correction across dealerships; however, the decline was steeper for two-wheelers and passenger vehicles (down 14% and down 9%; commercial vehicles declined 3%).
For our original equipment manufacturer coverage universe, we expect-aggregate revenue decline of 1% QoQ (including Jaguar Land Rover; -4% excluding JLR) owing to weak volumes and inventory correction and
Ebitda margin expansion of ~70 bps QoQ led by gross margin expansion (all OEMs), richer product mix and consistent price hikes.
We believe that premiumisation trend will continue to play out across segments: In PVs, OEMs with focus on sports utility vehicles (Mahindra and Mahindra Ltd. and Tata Motors Ltd.) will continue to do well.
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