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India’s two-wheeler gross sales more likely to fall 1-4% YoY in FY22: ICRA

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India’s two-wheeler gross sales are anticipated to contract by 1-4 per cent year-on-year (YoY) in FY22 on account of weak festive season efficiency, mentioned on Monday.

Accordingly, the ranking company cited that the relentless enhance in costs of two-wheelers coupled with record-high petrol charges saved customers away from dealerships. “The entry-segment (75-110cc), which dominates 2W (two-wheeler) gross sales in India, has remained subdued this 12 months, reflecting intensive (and prolonged) impression of the second wave of the pandemic. The lacklustre festive season efficiency additionally highlighted continued wariness among the many low-income inhabitants relating to big-ticket purchases,” mentioned Rohan Kanwar Gupta, Vice President and Sector Head, Company Rankings, ICRA.

“On the monetary entrance, given the excessive working leverage of the trade, subdued demand and elevated uncooked materials prices are anticipated to maintain the working margins constrained for the two-wheeler OEMs (unique tools producers) within the present fiscal,” Gupta mentioned. Apart from, the company mentioned rural offtake has lagged city, presumably on account of moderated agri-sentiments brought on by uneven monsoons and delayed harvesting throughout areas.

Moreover, for the city markets, the company’s report mentioned that the delay in reopening of faculties and faculties, weak earnings sentiments on account of job losses or wage cuts and prolonged work-from-home insurance policies by corporates, have impacted its gross sales. Moreover, it claimed that finance corporations have remained cautious due to a rise in delinquency ranges. India’s home two-wheeler gross sales for the primary seven months of FY22 had been flattish at 8.05 million on a YoY foundation, regardless of a “severely contracted base”, it added.

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