Automobiles & Auto Components share price target

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.

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

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.

Retail sales in the auto industry fell by 9.3% YoY in September 2024, reaching 17.2 lakh units. Two-wheeler retail sales decreased by 8.5% YoY to around 12 lakh units, while car sales plunged by 18.8% YoY to 2.8 lakh units.

Every segment except tractors and three-wheelers recorded a YoY decrease during this period.

In September, automobile wholesales of listed companies grew by 14.3% YoY to 17.8 lakh units. Exports increased by 16.2% YoY to 2.9 lakh units. Domestic two-wheeler wholesales of listed companies increased by 21% YoY to 13.3 lakh units, while passenger vehicles increased marginally by 0.1% YoY to 2.4 lakh units.

Thematic Research The EV Revolution - September 2024