Auto sector woes grow as sales drop further

The auto players continue to go through a rough drive as they report weak sales for the month of August 2019.

Maruti Suzuki, leading passenger car manufacturer, announced decline of 32.7 per cent in total sales in the month of August. It sold total 106413 units in August 2019 which includes 97061 units in domestic market and 9352 units of exports. It has registered de-growth of 36.1 per cent YoY in sales of domestic passenger vehicles. Also, exports sales de-grew by 10.8 per cent YoY.

Bajaj Auto posted 11 per cent decline in sales the month of August 2019 with total number of units sold 390026. Sale of motorcycles declined by 10 per cent YoY, whereas, CV sales fell by 13 per cent yoy.

Ashok Leyland, which offers a range of trucks and heavy vehicles, also posted poor numbers for the month of August. The total number of vehicles sold in August 2019 was 9231, showing 47 per cent YoY decline. Domestic sales declined by 50 per cent with sales of 8296 vehicles in August 2019. Total sales of M&HCV declined by 59 per cent YoY and sales of LCV declined by 8% YoY.

Eicher Motors, which produces iconic bike ‘Royal Enfield’ and also caters to commercial vehicles, posted negative numbers for total sales in August 2019 by 24 per cent YoY. However, exports jumped by 205 per cent YoY.

Following weak auto sales numbers, the NIFTY Auto index made an intraday low of 6888.30 and at the end of the session NIFTY Auto index was trading at 6939.25, down by 70 points. Looking at the stock movements of the auto makers, the stock of Maruti Suzuki declined nearly 2 per cent whereas Ashok Leyland gained by nearly 2 per cent.