Auto Sales in February 2013 remained lackluster - Kotak

Auto sales in February 2013 remained lackluster. As been the case over the past few months, the M&HCV segment remained the most impacted in the current slowdown. Passenger car sales and 2W volumes too remained subdued on the back of weak demand sentiment.

2W players reported volume de-growth of ~4%. Maruti Suzuki too reported volume decline in February 2013. M&M reported volume growth in the automotive segment, but tractor volumes stood weak. Tata Motors performance was the weakest with the company reporting significant volume drop in passenger vehicle and M&HCV segment.

In the near term, we do not expect any substantial change in the performance of the auto players as there were no major measures in the budget to stimulate demand. Over the medium to long term though, we expect demand improvement on the back of expected cut in interest rates by the RBI and pick-up in economic activities.

Source : Equity Bulls

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