Auto stocks jumped on Monday after strong demand for the all-new Mahindra Scorpio-N helped investors overlook monthly sales figures from their peers. Mahindra & Mahindra shares hit a 52-week high, helping the Nifty50’s biggest jump in five weeks. The launch of the Mahindra Scorpio-N comes at a time when automakers such as Maruti Suzuki are losing market share in the commercial vehicle segment.
As of 11 a.m., Mahindra & Mahindra was up 6.8%. Tata Motors, Ashok Leyland, TVS Motor, Maruti Suzuki and Bajaj Auto – up around 1-4% each – boosted Nifty Auto, which recorded its highest intraday jump since June 23.
Mahindra & Mahindra said on Saturday it received 1 lakh bookings for the all-new Scorpio-N within the first 30 minutes of the booking window opening, translating to an ex-showroom value of around Rs 18,000. crore.
M&M said there had been extraordinary customer enthusiasm for the vehicle, with 25,000 bookings in the first minute itself. Mahindra & Mahindra will begin deliveries of the Scorpio-N from September 26.
Nomura said the Scorpio-N is expected to transform Mahindra’s image into that of a lifestyle SUV maker, and has the potential to gradually add 10-15% upside to overall FY23- commercial vehicle volume. 24F from the automotive major.
The sector’s monthly sales data, however, was mixed.
Total M&M sales jumped 30.6% year on year to 56,148 units last month. Its domestic passenger vehicle sales were 28,053 units, up 33 percent compared to the period a year ago.
Mahindra’s exports jumped 32% to 2,798 vehicles.
Maruti Suzuki – India’s largest automaker – reported total sales of 1.75 lakh units for the month, compared to Nomura’s estimate of 1.76 lakh. Its total sales increased by 8.3% on an annual basis.
Domestic passenger vehicle sales rose 6.8 percent to 1.42 lakh vehicles, according to Maruti Suzuki.
Maruti exports, however, fell 4.3% to 20,311 vehicles, a filing showed.
Tata Motors’ total sales jumped 51% to 81,790 units, according to a regulatory filing. The number of monthly sales, however, was below Nomura’s estimate of 83,100 units.
Its total domestic passenger vehicle sales increased 57% to 78,978 units.
Ashok Leyland reported total sales of 13,625 vehicles, up 58% but less than Nomura’s estimate of 14,400 vehicles.
Bajaj Auto reported total sales of 3.54 lakh units in July, down 4.1 percent from the corresponding period a year ago. Nomura had estimated the company’s total sales for the month at 4 lakh units.
Total exports fell 15% year on year to 1.71 lakh vehicles, according to a regulatory filing. Its domestic sales, however, rose to 1.83 lakh units last month from 1.67 lakh a year ago.
Three-wheeler exports fell 23% on an annual basis thanks to Egypt’s decision to ban three-wheelers, depending on the file.
The bad news was not limited to the two- and three-wheeler segments, but even to agricultural equipment – an indicator of demand in the rural economy.
Escorts reported total tractor sales of 5,360 units in July 2022, down 18.3% from the prior year period. The tractor maker’s domestic sales fell 22.3% to 4,704 vehicles.
Mahindra & Mahindra tractor sales fell 14% to 23,307 vehicles.
VST Tillers – a maker of power tillers and multi-purpose agricultural tractors – recorded total sales of 4,249 units last month, down 3.4% from the same period a year earlier.
First post: STI