Automobiles & Auto Components share price target

Q4FY25 Earnings Play : Auto OEMs: Ashok Leyland, TVS Motors. (M&M - Non-Coverage) Auto Ancillary: UNO Minda, Sansera Engineering Ltd, SSWL

Valuation & View

In the long term, we prefer TVS Motors and Hero Motocorp in 2Ws; M&M (non-coverage) as a play in the PV/LCV/tractor segment, followed by Maruti in PVs. We also keep a close watch on Ashok Leyland and Eicher (VECV) in the CV space for potential volume growth

Auto industry sales in Q4FY25E exhibited a mixed trend. January recorded healthy traction, supported by beginning-of-year momentum and ongoing promotional schemes. However, demand gradually tapered in February and is expected to remain muted in March, with no major catalysts to drive retail acceleration.

We prefer TVS Motors and Hero Motocorp in 2Ws; M&M (non-coverage) as a play in the PV/LCV/tractor segment, followed by Maruti in PVs. We also keep a close watch on Ashok Leyland and Eicher (VECV) in the CV space for potential volume growth.

Valuation & View

Top Conviction Ideas (Auto and Auto Ancillaries) - Hero Motocorp Ltd, Ashok Leyland, Uno Minda, Sansera Engineering

We prefer TVS Motors Hero Motocorp in the 2Ws; M&M (non-coverage) as a play in the PV/LCV/tractor segment, followed by Maruti in PVs; we also monitor Ashok Leyland, Eicher (VECV) in the CV space for potential spurt in volumes.

Q3FY25 Earnings Preview - Automobile

In Q3FY25, the auto OEM sector showed mixed performance across segments. PV OEMs saw
strong growth during the festive season, fueled by higher demand for hatchbacks and increased discounts particularly in MSIL.

Valuation & View

In the near term, we believe the Auto Sector to witness consolidation across all segments. In the long run, we prefer M&M (non-coverage) as a play in the PV/LCV/tractor segment; we also monitor Ashok Leyland in the CV space for potential spurt in volumes.

On a medium-term outlook, we prefer 2W OEMs over PV and Tractor; and remain cautiously positive on the CV space. We continue to prefer Hero Motocorp in the 2W segment; and M&M (non-coverage) as a play in the PV/LCV/tractor segment.

Valuation & View

Top Conviction Ideas - Hero Motocorp Ltd; Sansera Engineering Ltd; Uno Minda Ltd.

The overall Indian auto sector delivered mixed results in Q2FY25. Passenger vehicles (PVs) saw strong demand, driven by SUV sales and export growth. Commercial vehicles (CVs) posted modest growth, supported by infrastructure demand but hindered by slowed mining activity, heavy rains, and regional challenges.

On a medium-term outlook, we prefer 2W OEMs over PV and Tractor; and remain cautious in the CV space. We continue to prefer TVS and Hero Motocorp in the 2W segment; and M&M (non-coverage) as a play in the PV/LCV/tractor segment.

Auto Sales Update