In 2006, components worth $2 billion, around Rs 90,000 crore were exported by Indian companies, 75 percent of which were bought directly by car companies.
After a stellar run on the bourses that saw tractor stocks rise up to 52 per cent, analysts are turning cautious on the sector as muted demand trends may weigh in the near-term. Total volumes in the tractor segment for the last three quarters of the current financial year (9MFY24) have remained weak with VST Tillers, Escorts Kubota, and M&M seeing declines of 21 per cent, 5 per cent, and 3 per cent year-on-year (Y-o-Y), respectively, during the period, amid patchy rainfall, delayed crop harvest, and lower reservoir level. Across industry, total domestic sales volume so far in the current financial year (April '23 to January '24) has declined 5 per cent Y-o-Y, as per Tractor Manufacturers Association (TMA).
Maruti Suzuki and Hyundai Motors are expected to see overseas sales fall sharply following the recent removal of an incentive scheme.
'We will see a lot of investments from the private sector.' 'As long as we are not impacted by some global events, I think we will be in a strong place.'
Leading automakers Maruti Suzuki, Hyundai and Tata Motors on Thursday reported robust sales in March as a shift towards personal mobility and pent up demand continued to help companies push dispatches to their respective retail partners. Toyota Kirloskar Motor, Honda Cars and Mahindra and Mahindra (M&M) also reported strong sales last month as compared to the year-ago period, when dispatches were adversely impacted due to the impending transition to BSVI from April 2020 and the nationwide lockdown to contain the coronavirus pandemic. The country's largest carmaker Maruti Suzuki India said its domestic sales stood at 1,49,518 units last month. The auto major had reported sales of 76,976 units in March 2020.
Maruti Suzuki India on Wednesday reported a 42 per cent rise in consolidated net profit to Rs 2,671 crore for the fourth quarter ended March 2023, driven by higher sales, improved realisation and favourable forex movement. The country's largest carmaker logged a net profit of Rs 1,876 crore in the January-March of 2021-22. Net sales during the fourth quarter rose to Rs 32,060 crore compared to Rs 26,749 crore in the year-ago period, Maruti Suzuki India (MSI) said in a regulatory filing.
Consolidated earnings of Bharat Forge in Q3FY23 missed estimates, largely due to higher-than-expected interest burden, although operational numbers (including standalone numbers) were close to consensus. Still, the management guidance was positive and appeared to be based on logic.
Nifty50's earnings growth, estimated at 20 per cent by global research and brokerage firm Jefferies for financial year 2023-24 (FY24), will be amongst the top three in the Asian region, and is likely to outperform peers. Asean 40 index with 29.1 per cent estimated earnings growth and Straits Times Index (STI) with 29.1 per cent estimated earnings growth are the only two other indices in the Asian region that are likely to outperform India, suggests the recent Jefferies report, coauthored by Mahesh Nandurkar, their managing director along with Abhinav Sinha and Nishant Poddar.
Sector-wise, pharmaceuticals, transport equipment and textiles will help accelerate overall export growth.
India is a market for low-priced cars with low running costs. The global majors don't have models that fit the bill; only Maruti and Hyundai have successful entry-level models, observes T N Ninan.
With little clarity on the demand outlook, investors should wait out the next couple of quarters rather than rush in to catch a falling knife, says Ram Prasad Sahu.
Experts call for consistency in government policies to enable Indian exporters to frame a long-term strategy.
Consumer goods firms and auto companies are witnessing an upturn in rural demand, which had been lagging for most of FY24. Expectations of a bumper rabi crop harvest have helped turn the tide. The Reserve Bank of India's (RBI's) Monetary Policy Committee kept the repo rate unchanged last week, noting that as rural demand catches up, consumption is expected to support economic growth in 2024-25.
Since its results for the first quarter of the 2023-24 financial year (Q1FY24) earlier this month, the stock of auto component major Bharat Forge is up nearly 15 per cent and hit its all-time high in the process. The recent gains have extended the returns over the last three months to over 34 per cent. After a strong Q1 performance which beat expectations, brokerages had revised their earnings estimates upwards to factor in the improved outlook.
India's auto component makers are facing one of the biggest crises ever. With the domestic market in the doldrums and the exports to the American market badly hit, many companies are on the verge of shutting down.
Royal Enfield's sales are equivalent to the global sales of Harley-Davidson, KTM, BMW, Triumph, and Ducati combined, but Bajaj's MD has a counterview.
Japanese auto giant Suzuki Motor Corporation on Tuesday said it plans to make India an export hub for its small cars, mainly for European and African markets.
After getting periodic extensions, the 14-year-old tax-refund scheme is finally coming to an end in June.
After GM's India exit, Ford-Mahindra 'strategic alliance' under spotlight.
Despite multiple headwinds at the start of 2023, the Indian markets delivered a strong performance, posting 19-20 per cent growth for the year. Even as new records were set, investor sentiment remains strong going into 2024, given the lower inflation, expectations of steady to lower interest rates, higher economic growth, and strong inflows. However, the overriding concern for most brokerages is valuations.
India on Friday unveiled a slew of trade initiatives to emerge as a global hub for jewellery and auto parts and increase services exports, while pegging the export target at $120 billion in 2006-07.
Backed by strong demand for Indian vehicles from markets such as South Africa, Tata Motors has exported more than 50,000 vehicles during 2005-06 showing a growth of over 65 per cent over the previous year.
Jimny will be priced between Rs 12.7 lakh and Rs 15.05 lakh.
'I'm very much against petrol and diesel....'' 'I travel in an electric car.' 'I have had a really good experience with it.'
Higher defence and agri credit allocation will encourage new vehicle buying which in turn will benefit the industry players.
India's largest two-wheeler maker by volume - Hero MotoCorp (Hero) - posted a better-than-expected operating performance in the January-March (fourth quarter, or Q4) quarter of 2022-23 (FY23). Riding on higher average selling prices which were up 5 per cent year-on-year (YoY) and volume growth of 7 per cent, the company registered a 12 per cent growth in revenue to Rs 8,306 crore. The company sold 127,000 units in the quarter, largely driven by domestic sales which were up 11.6 per cent, while exports saw a sharp fall of 57 per cent over the year-ago quarter.
The first major consignment of 3,886 Micra cars left the Ennore Port for European markets on Tuesday, Nissan Motor India said.
A Canadian company will be manufacturing auto parts for Tata's Nano, as more Canadian companies look for business avenues in India.
Lower IT exports will raise India's dependence on capital flows to fund imports.
The study has been conducted by Ernst & Young on behalf of EEPC-India, the apex body of engineering goods exporters.
Automobile sector accounts for the third-highest equity mutual fund contributions.
Discussions are also going on to bring PLI scheme for toys, furniture, bicycles and containers. The objective of the scheme is to make domestic manufacturing globally competitive, create global champions in manufacturing, boost exports and create jobs.
The government on Monday unveiled the new Exim Policy which gives a massive thrust to services, exports, removal of restrictions on exports and makes the Export Promotion Capital Goods scheme more flexible.
New Creta, petrol Vitarra Brezza.. A quick look at what went down at Auto Expo Day 2.
At a time when many major global auto markets witnessed declines, Indian carmakers were able to expand their overseas presence with exports from the country registering a robust 33.23 per cent growth in the last fiscal.
Even as banks and finance companies are reporting record-high earnings, their weighting in the benchmark National Stock Exchange Nifty50 Index has seen a downward trajectory. Investors expect a stronger performance from other sectors in the new year. Currently, banking, financial services and insurance (BFSI) companies collectively hold a weighting of 34.5 per cent, down from 36.7 per cent at the end of December 2022 and a record high of 40.6 per cent at the end of December 2019. This represents the sector's lowest weighting in the index since December 2021 when it stood at 33.7 per cent.
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