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Personal mobility won't decline despite rise in fuel costs: ICICI Securities

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Personal mobility won't decline despite rise in fuel costs: ICICI Securities

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According to Basudeb Banerjee, Analyst, ICICI Securities, Maruti, which is succumbing to profitability, don’t want to scale up and subsidise electric vehicles (EVs) to push volumes and further pressurize their profitability.

People are reallocating their monthly expenditure towards personal mobility as a hygiene element rather than using mass transportation, according to Basudeb Banerjee, Analyst, ICICI Securities. “So despite rising fuel cost, we don’t see personal mobility space to decline further,” he said.
In the longer run, if one sees the penetration level for cars and LCVs and premiumisation scope in two-wheelers, one more year of free cashflow impact should not impact the overall valuation significantly.
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Market is efficiently looking at the margin damage as one more year of phenomenon rather than a structural aspect, he said.
According to him, Maruti, which is succumbing to profitability, don’t want to scale up and subsidise electric vehicles (EVs) to push volumes and further pressurize their profitability.
Watch the accompanying video for the full interview
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