Maruti Suzuki, TVS Motor and ashok Layland were among common names that brokerages remained bullish on following a muted set of April sales figures. A few brokerages also like Tata Motors and Bajaj Auto.
Kotak Institutional Equities said numbers were weak for April and that even as two-wheeler volumes came in-line with expectations, commercial vechile (CV) and tractor segment volumes were below estimates.
Domestic PV industry retail volumes witnessed 3-4 per cent YoY growth, it said adding that "The CV segment remained subdued on account of pre-buying in March and tractor segment volumes declined YoY due to channel destocking in April."
Axis Securities said it remains selective and for OEMs under its coverage, the brokerage prefers TVS Motor and Eicher Motors (Royal Enfield) in the two-wheeler segment, Maruti Suzuki in the personal vehicle (PV) segment, and Ashok Leyland in the commercial vehicle (CV) space.
Elara Secuities prefer Maruti Suzuki, Mahindra & Mahindra (M&M) TVS Motor and Hero MotoCorop among auto names. Nomura India likes M&M. Ashok Leyland, Tata Motors and Bajaj Auto.
Motilal Oswal Securities said it prefers CVs over other segments thanks to strong demand and a stable competitive environment.
"We prefer companies with higher visibility in terms of demand recovery, a strong competitive positioning, encouraging margin drivers, and a strong balance sheet. Ashok Leyland and Tata Motors are our top OEM picks," it said.
LKP Securities likes Bajaj Auto as we expect bounce back of exports 3-4 months down the line as dollar scenario may improve in Africa. Also the EV strength gaining from Chetak and upcoming launch of e-3W can be additional positives, it said.
"TVS too looks good with its dominance in EV scooters and solid performance by its new launches. While on the PV side, we like M&M because of its thrust on rural markets through its leadership in tractors business, prudent capital allocation and a robust growth strategy in UVs, EVs and CVs. We also like Maruti Suzuki on the PV side," it said.
LKP also likes Ashok Leyland within CVs, due to its diversified revenue base deriving from LCVs, defence, MHCVs, exports and spares.
"Every dip in the stocks mentioned above, shall provide good opportunities for investors to enter into them from medium to long term perspective," the bokerage added.
JM Financial said PV segment wholesales are likely to be a function of further normalisation of supplies and response to recent model launches in near-term. Two-wheeler demand remains contingent on rural sentiment, it said.
"Steady freight rates have supported the profitability of CV operators. Rising interest rates, however, remains a key deterrent. We expect CV volumes to be supported by demand from infra & construction sectors," it said.
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