Car makers' shares dip after FADA's April sales report; Tata Motors, M&M top laggards

Car makers Maruti Suzuki, Tata Motors and Mahindra & Mahindra shares were marginally under pressure after the automobile dealers' body FADA said passenger vehicle retail sales in India declined by 1 per cent last month.

Individually, Maruti Suzuki was mainly flat with a negative bias, followed by Tata Motors and M&M each down between 0.25-0.5 per cent on the BSE during Thursday’s trade.

The passenger vehicle retail sales declined to 2,82,674 units last month as compared with 2,86,539 units in April 2022.

The association noted that the buyers preponed purchases to March in order to avoid enhanced prices on account of stricter emission norms kicking in from April 1, 2023.

Nifty Auto Index was marginally up by 0.14 per cent led by auto ancillary stocks such as MRF, Balkrishna Industries, and among others.

"The passenger vehicle segment, which achieved record sales in FY23, slowed down in April... This was primarily due to last year's high base and the OBD 2A norms, which led to vehicle price increases and advanced purchases in March," Federation of Automobile Dealers Associations (FADA) President Manish Raj Singhania said in a statement.

Two-wheeler registrations declined by 7 per cent to 12,29,911 units in April as against 13,26,773 units in the year-ago period.

The drop in sales can be attributed to limited supplies due to the OBD 2A shift, untimely rains and pre-buying in March, Singhania said.

Model mix availability, rural sentiment and demand in the two-wheeler motorcycle segment remain weak, he added.

"The rural economy has yet to show significant progress. Compared to the pre-Covid April 2019, two-wheeler sales are still down by 19 per cent," Singhania noted.

Three-wheeler retail sales stood at 70,928 units last month, up 57 per cent as compared with 45,114 units in April 2022.

Similarly, commercial vehicle registrations were up 2 per cent to 85,587 units in April from 83,987 units in the year-ago period.

Tractors' retail sales also witnessed an increase of 1 per cent to 55,835 units last month as against April 2022.

Retail sales across categories declined by 4 per cent to 17,24,935 units last month as against 17,97,432 units in April 2022.

With PTI Inputs