Earlier Post: Automobiles Sector Basics: 101
Automobiles are again a relatively simpler sector, and the most important data to look forward to are monthly sales numbers, margins, sequential growth, dealer inventory (short term), demographics, penetration levels (long term).
A very brief look into each of the companies, and their monthly sales numbers:
Automobiles are again a relatively simpler sector, and the most important data to look forward to are monthly sales numbers, margins, sequential growth, dealer inventory (short term), demographics, penetration levels (long term).
A very brief look into each of the companies, and their monthly sales numbers:
- Maruti: Sold 100,000 cars in Dec 2009, highest ever. Expected per month run rate is 70,000 to 90,000 going forward. The big growth driver is from the exports, which now account for close to 15% of the overall sales for Maruti. However, there are concerns with new global players eyeing the market in 2010, with some new models.
- M&M: There are two separate divisions – (a) Automotive consisting of 3 and 4 wheelers, and (b) Tractors. Overall monthly numbers were 36,000 in the month of Dec 2009, and the about 1/3rd is from Tractors. M&M has seen a very high volume growth over the past one year, and that should explain some of the gains in the stock price.
- Tata Motors: Tata Motors too caters to too very distinct segments – (a) Commercial Vehicles, and (b) Passenger vehicles. The overall sales numbers in Dec 2009 were 51,000, and bulk of the sales is in the domestic market (with less than 5% exports). Also, the recently introduced Manza and Magic are receiving tremendous response.
- Hero Honda: The Company is reporting rise in the vehicle sales month after month, and the current run rate stands very close to 400,000 units per month. Also, the company plans to introduce 3 new products/variants in the next 2 months. The company is currently operating very close to its total capacity, and hence a great uptick from these numbers is unlikely.
- Bajaj Auto: Bajaj is fast catching up with Hero Honda, and has a good presence in the premium bike segments. The monthly sales numbers currently stands at 250,000, and these are mostly from bikes.
- TVS Motors: A relatively smaller player in the sector, with monthly sales of 110,000 units (mostly bikes and other 2-wheelers)
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