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India Equity Research Reports, IPO and Stock News
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December 2011 auto volumes indicate a slowdown in demand for 2-
wheelers, in line with our expectations. Domestic volumes at BJAUT
increased by only 3% y-y, while total 2W volumes at TVSL remained flat
y-y. The petrol car segment for MSIL remained weak, with volumes in
the lower-end petrol segment declining by 16% y-y. Demand for M&Ms
automotive segment remained quite strong (up 26% y-y); however,
tractor volumes disappointed. TTMT reported another set of strong
numbers; overall volumes increased 22% y-y. We maintain our Buy
recommendations on TTMT and MM.
Tata Motors (TTMT IN)
Tata Motors’ volumes increased by 22% to 82,278 units in December
2011, coming in 4% ahead of our expectations of 79,300 units. Domestic
MHCV sales were in line with our expectations; however, sales in
passenger vehicles, particularly UVs, were above expectations, perhaps
helped by the new variant (Tata Sumo Gold).
Domestic MHCV volumes increased 4.7% y-y, indicating a SAAR of 12%
growth for FY12 – higher than our expectation of 8%. Volumes in the
LCV segment increased by 20% y-y in December 2011. SAAR
moderated slightly to 36% (from 39% November 2011) growth in FY12F;
however, it was still higher than our full-year assumption of 30% y-y
growth. UV volumes increased 90% y-y, indicating 18% y-y growth in
FY12 vs our expectation of flat volumes. SAAR in the car segment is
indicating 3% y-y growth in FY12 vs our expectation of a 20% decline
Mahindra & Mahindra (MM IN)
Mahindra & Mahindra reported strong numbers for the Auto sector, up
26% y-y at 42,761 units, 8% ahead of our estimate of 39,500 units. All the
segments reported strong volume growth, as highlighted in our recent
channel checks report. M&M is planning to reopen XUV 500 bookings
from this month, and that should, in our view, spur strong growth
However, tractor volumes have disappointed, with y-y total volumes
remaining flat in December 2011. We were expecting 10% y-y growth.
SAAR is now indicating 12% y-y growth for FY12.
We believe the Street will be disappointed by weak tractor numbers and
expect the stock to react negatively to this news.
Maruti Suzuki (MSIL IN)
MSIL’s December 2011 volumes declined 7% y-y to 92,161 units. This is
ahead of our expectations of 82,000 units, primarily due to strong growth
in exports. Export volumes were up 50% y-y due to order backlog over
the past few months. Overall domestic volumes declined by 13.4% y-y in
December 2011. The volume pressure is clearly evident on the lowerend
petrol segments (M800, Alto), which has declined by 16% y-y. The
ramp-up in volumes of successful models such as the Swift and Dzire,
which have diesel variants have helped volumes, in our view.
SAAR is indicating 11% y-y decline for FY12 volumes, largely in line with
our expectation of a 10% decline.
Bajaj Auto (BJAUT IN)
BJAUT’s December 2011 volumes increased 10% y-y to 305,690 units,
6% lower than our estimates of 324,000 units. Despite strong growth in
exports, overall volume growth was weaker due to a slowdown in
domestic volumes. This is in line with the feedback from our channel
checks. Total domestic volumes increased by only 2.5% y-y in
December 2011.
Hero MotoCorp (HMCL IN)
HMCL’s December 2011 volumes came in at 540,276 units, up 7.8% y-y;
ahead of our expectations of 510,000 units. We believe that there has been
some channel filling in this month as well, which has helped volumes. Our
channel checks suggest that underlying retail demand remains slow. We
don’t expect the stock to react significantly to these numbers.
TVS Motors (TVSL IN)
TVSL’s December 2011 volumes declined by around 1% y-y to 170,428
units, largely in line with our expectation of 172,000 units. Overall, SAAR
improved slightly for scooters and mopeds, but largely remained flat for
motorcycles.
Domestic 2-wheeler sales was down 1.7% y-y in December 2011, while
2W exports increased by 11% y-y. The Scooters segment witnessed
strong 9% y-y growth; SAAR is indicating 20% y-y growth in FY12, lower
than our expectations of 30% growth. Motorcycle sales were down 8% yy,
with SAAR indicating flat volumes in FY12, lower than our
expectations of 11% growth. SAAR for mopeds indicates 15% y-y growth
in FY12, higher than our expectations of 12% growth.
Ashok Leyland (AL IN)
Ashok Leyland’s December 2011 volumes came in at 9,088 units (vs our
estimate of 8,900 units), up 20% y-y. This included 1,099 units of the
new LCV Dost. MHCV volumes were up 7% y-y. The SAAR now points
to flat MHCV volumes for FY12, in line with our estimates
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
December 2011 auto volumes indicate a slowdown in demand for 2-
wheelers, in line with our expectations. Domestic volumes at BJAUT
increased by only 3% y-y, while total 2W volumes at TVSL remained flat
y-y. The petrol car segment for MSIL remained weak, with volumes in
the lower-end petrol segment declining by 16% y-y. Demand for M&Ms
automotive segment remained quite strong (up 26% y-y); however,
tractor volumes disappointed. TTMT reported another set of strong
numbers; overall volumes increased 22% y-y. We maintain our Buy
recommendations on TTMT and MM.
Tata Motors (TTMT IN)
Tata Motors’ volumes increased by 22% to 82,278 units in December
2011, coming in 4% ahead of our expectations of 79,300 units. Domestic
MHCV sales were in line with our expectations; however, sales in
passenger vehicles, particularly UVs, were above expectations, perhaps
helped by the new variant (Tata Sumo Gold).
Domestic MHCV volumes increased 4.7% y-y, indicating a SAAR of 12%
growth for FY12 – higher than our expectation of 8%. Volumes in the
LCV segment increased by 20% y-y in December 2011. SAAR
moderated slightly to 36% (from 39% November 2011) growth in FY12F;
however, it was still higher than our full-year assumption of 30% y-y
growth. UV volumes increased 90% y-y, indicating 18% y-y growth in
FY12 vs our expectation of flat volumes. SAAR in the car segment is
indicating 3% y-y growth in FY12 vs our expectation of a 20% decline
Mahindra & Mahindra (MM IN)
Mahindra & Mahindra reported strong numbers for the Auto sector, up
26% y-y at 42,761 units, 8% ahead of our estimate of 39,500 units. All the
segments reported strong volume growth, as highlighted in our recent
channel checks report. M&M is planning to reopen XUV 500 bookings
from this month, and that should, in our view, spur strong growth
However, tractor volumes have disappointed, with y-y total volumes
remaining flat in December 2011. We were expecting 10% y-y growth.
SAAR is now indicating 12% y-y growth for FY12.
We believe the Street will be disappointed by weak tractor numbers and
expect the stock to react negatively to this news.
Maruti Suzuki (MSIL IN)
MSIL’s December 2011 volumes declined 7% y-y to 92,161 units. This is
ahead of our expectations of 82,000 units, primarily due to strong growth
in exports. Export volumes were up 50% y-y due to order backlog over
the past few months. Overall domestic volumes declined by 13.4% y-y in
December 2011. The volume pressure is clearly evident on the lowerend
petrol segments (M800, Alto), which has declined by 16% y-y. The
ramp-up in volumes of successful models such as the Swift and Dzire,
which have diesel variants have helped volumes, in our view.
SAAR is indicating 11% y-y decline for FY12 volumes, largely in line with
our expectation of a 10% decline.
Bajaj Auto (BJAUT IN)
BJAUT’s December 2011 volumes increased 10% y-y to 305,690 units,
6% lower than our estimates of 324,000 units. Despite strong growth in
exports, overall volume growth was weaker due to a slowdown in
domestic volumes. This is in line with the feedback from our channel
checks. Total domestic volumes increased by only 2.5% y-y in
December 2011.
Hero MotoCorp (HMCL IN)
HMCL’s December 2011 volumes came in at 540,276 units, up 7.8% y-y;
ahead of our expectations of 510,000 units. We believe that there has been
some channel filling in this month as well, which has helped volumes. Our
channel checks suggest that underlying retail demand remains slow. We
don’t expect the stock to react significantly to these numbers.
TVS Motors (TVSL IN)
TVSL’s December 2011 volumes declined by around 1% y-y to 170,428
units, largely in line with our expectation of 172,000 units. Overall, SAAR
improved slightly for scooters and mopeds, but largely remained flat for
motorcycles.
Domestic 2-wheeler sales was down 1.7% y-y in December 2011, while
2W exports increased by 11% y-y. The Scooters segment witnessed
strong 9% y-y growth; SAAR is indicating 20% y-y growth in FY12, lower
than our expectations of 30% growth. Motorcycle sales were down 8% yy,
with SAAR indicating flat volumes in FY12, lower than our
expectations of 11% growth. SAAR for mopeds indicates 15% y-y growth
in FY12, higher than our expectations of 12% growth.
Ashok Leyland (AL IN)
Ashok Leyland’s December 2011 volumes came in at 9,088 units (vs our
estimate of 8,900 units), up 20% y-y. This included 1,099 units of the
new LCV Dost. MHCV volumes were up 7% y-y. The SAAR now points
to flat MHCV volumes for FY12, in line with our estimates
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