Motilal Oswal
    NIFTY 50
Motilal Oswal

CIMB says macro factors like fuel, commodity cost turning favourable for automobile sector

Updated : June 28, 2019 11:50 AM IST

Macro factors like fuel, commodity cost are turning favourable for the automobile sector, which has been severely hit by a massive slowdown, said Pramod Amthe, head of Equity Research at CIMB. He, however, said that the June sales are expected to be lower.

“In terms of high-frequency data like monthly numbers, June will continue to remain weak as we are seeing many continuing to take up maintenance shutdown. So the inventory rundown picture will continue for a large part of June and even the early part of July," said Amthe, in an interview with CNBC-TV18.

On Maruti, he said, "We feel autos purchases are deferred than completely cancelled. So as and when it comes back, it should be a decent growth to look forward to."

Speaking about 2-wheelers, Amthe said, “Hero scores and edges versus rest of the peers even though there is some volume comfort in Bajaj but margin comfort continues to miss in Bajaj which keeps Bajaj on hold and Hero on add and Eicher on sale.”
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