Shares of various automobiles manufacturers were trading lower on Wednesday after the data released by the Society of Indian Automobile Manufacturers (SIAM) showed a slump in domestic sales generated as well as the production figures.
As per the SIAM report, India's passenger vehicles sales slumped 17.54% to 2.25 lakh units in June from 2.7 lakh units in the year-ago period.
While domestic car sales fell 24.07 % to 1.39 lakh units as against 1.83 lakh units in June 2018, total two-wheeler sales dropped 11.69% in June to 16.49 lakh units compared to 18.67 lakh units in the year-ago month, according to data released by the Society of Indian Automobile Manufacturers (SIAM).
For the quarter ended June 30, 2019, vehicle sales across all categories declined by 12.35% to 60.85 lakh units from 69.42 lakh units. In terms of production, there has been a decline of 10.53% from 80.64 lakh units to 72.15 lakh units. Although, the exports for vehicle across all categories has increased by 0.16% from 11.94 lakh units to 11.96 lakh units.
Earlier, on June 5, the country's largest car maker Maruti Suzuki India (MSI) announced cut in vehicle production for the fifth consecutive month in June, on surging inventories. Today, Tata Motors has also released sales figures for Jaguar Land Rover (JLR). As per the report, total JLR sales were down 9.6% at 47,060 units year-on-year (YoY), with Jaguar retail sales in June declining 8.5% year-on-year and 10.1% fall in Land Rover retail sales.
The domestic automobile industry under slowdown has resulted in shut down of a record 245 car dealerships across the country over the last 18 months.
As per SIAM report, car sales were impacted on grounds of slowed economy, low consumer sentiment, finance availability, drop in rural demand and increase in insurance cost. On the other hand, two wheeler sales were impacted due to low sentiments in rural sector and price increase in vehicles, that further caused increase in insurance cost as well as ABS implementation.
Additionally, SCV and Pick up sales were negatively impacted due to lower consumer durable sales and drop in crop prodcution. Sales of 3 wheelers were down on lack of permits and slowdown in FMCG sector.
Shares of Tata Motors was trading 3% lower, hitting their lowest since February 11, followed by a 2% decline in TVS Motors and Bharat Forge, 2% loss in Bajaj Auto, 1.70% in Hero Motocorp and around 1% in Mahindra & Mahindra.
Others auto shares quoting around 0.50% decline were namely, Exide Industries, Bosch, Eicher Motors and Amara Raja Batteries.
Of the stocks trading lower, Maruti Suzuki (Rs 5,900) and Bosch Ltd (Rs 15,801.20) had hit 52- week low in today's trade, while shares of Eicher motors, TVS Motors, Bharat Forge, M&M, Hero Motocorp and Exide were trading close to their 52-week low.
Edited by Rupa Burman Roy
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