Chart Beat: Passenger vehicle sales to rise in February

livemint.com:

Passenger vehicle (PV) registrations in February grew year-on-year but dropped sequentially, according to Vahan data. Nomura Financial Advisory and Securities (India) estimates that retail sales hit approximately 330,000 units in February, marking an 8% year-on-year increase.

Notably, vehicle discounts saw a rise month-on-month following a seasonal dip in January, according to the report by Nomura. Consequently, wholesale volumes for PVs are expected to exhibit a similar pattern of annual growth coupled with a sequential decline.

Here, companies with portfolios skewed towards utility vehicles such as Mahindra & Mahindra Ltd (M&M) have an upper hand given the increasing preference for premium vehicles. With an impressive order backlog of around 226,000 units as of 1 February and its efforts to ramp-up capacity, M&M is likely to grow ahead of the industry average in the coming months.

Tata Motors Ltd, boasting a healthy utility vehicle portfolio, is also set to benefit from robust demand. Conversely, the entry-level vehicle segment continues to struggle with persistent weak demand, adversely affecting volumes of Maruti Suzuki India Ltd.