Sales of medium and heavy commercial vehicles (MHCV) for most of the manufacturers fell sharply in November after advancing at a brisk pace for over a year, reflecting a sluggishness in the overall economy.
Combined sales at top four manufacturers — Tata Motors, Ashok Leyland, Volvo Eicher Commercial Vehicles, and Mahindra and Mahindra — dropped 20% to 20,324 units in November, compared with the same period a year ago, shows monthly sales data released by auto companies.
The drop in sales has come on the back of higher cost of borrowing, lesser load and reduced freights, which in turn have impacted transporter’s viability. Auto firms count dispatches to dealers as sales, the Business Standard reported. CLICK HERE TO READ FULL REPORT
“Despite the near-term volatility arising from higher diesel price, availability and cost of finance and recent revision in axle norms, the management expects CV growth momentum to sustain till FY20 (pre-buy before BS6 norms),” analysts at JM Financial said in a company update.
Bharat Forge has recently received the first export order for its aluminium lightweighting business, which is likely to be a key growth trigger in the medium term. The company’s oil & gas segment is at its all-time high, as demand for FRAC pump will continue to increase until Brent is below 50 USD/barrel. However, with the implementation of WLTP (Worldwide Harmonised Light Vehicle Test Procedure) in EU starting 01 Sep’18, OE sales have been lower, impacting the aluminium forging volumes done at European subsidiaries (likely to continue till 4QCY18), the brokerage firm said in a note.
At 10:47 am, Bharat Forge was trading 9% lower at Rs 531 on BSE, as compared to a 0.58% decline in the S&P BSE Sensex. The trading volumes on the counter jumped more than seven-fold with a combined 5.15 million equity shares changed hands on the BSE and NSE so far.