Please Share:: 
The components industry to vroom ahead!
Indian stock market has witnessed strong investor interest in the auto
components sector. We try to read into the investors mind to gauge the
probable reasons for the same and look for various winners in the space.
India auto story is back- “Pent up demand, income growth, penetration”
India in last decade has grown into a large automotive market particularly
for Japanese OEMs while the European and American’s have also
entered for the long haul. India however due to the recent economic
slowdown witnessed weak auto sales which impacted consumer as well
as OEM sentiment. We believe henceforth India auto story will now be
driven by four factors : a)pent up demand (low sales last 2-3 years),b)
reducing food and fuel inflation (down 600 bps to 9.4%/ down 400 bps to
4%) from peak) c) income growth due to improved business climate,
d)lower penetration into households (e.g. 14 per thousand in Passenger
vehicles). We believe the Indian automotive market could witness ~15%
CAGR FY14-17E on the back of the demand improvement. From auto
component maker’s perspective besides, the aforementioned reasons
would also lead to higher content per car and consumers up-trading to
higher quality & safety and increased features.
�� India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details ��
��
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The components industry to vroom ahead!
Indian stock market has witnessed strong investor interest in the auto
components sector. We try to read into the investors mind to gauge the
probable reasons for the same and look for various winners in the space.
India auto story is back- “Pent up demand, income growth, penetration”
India in last decade has grown into a large automotive market particularly
for Japanese OEMs while the European and American’s have also
entered for the long haul. India however due to the recent economic
slowdown witnessed weak auto sales which impacted consumer as well
as OEM sentiment. We believe henceforth India auto story will now be
driven by four factors : a)pent up demand (low sales last 2-3 years),b)
reducing food and fuel inflation (down 600 bps to 9.4%/ down 400 bps to
4%) from peak) c) income growth due to improved business climate,
d)lower penetration into households (e.g. 14 per thousand in Passenger
vehicles). We believe the Indian automotive market could witness ~15%
CAGR FY14-17E on the back of the demand improvement. From auto
component maker’s perspective besides, the aforementioned reasons
would also lead to higher content per car and consumers up-trading to
higher quality & safety and increased features.
�� India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details ��
��
LINK
http://content.icicidirect.com/mailimages/IDirect_AutoComponents_SectorUpdate_Oct14.pdf
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