Competitive intensity in two-wheeler space has always been pretty high, according to Gaurav Mehta, fund manager at Ambit Asset Management.

According to Mehta, the erstwhile market leader that is now engaging in price wars was struggling for market share for quite some time and as a result with a strong balance sheet resorting to aggressiveness in terms of price cutting, etc was something to be expected.

“Historically you have seen that whoever has tried with price cutting strategies in the two wheeler market, has not succeeded much in terms of gaining a lot of market share. At the commuter level it might work to some limited extent, but I do not think it will be something which will completely change the dynamics of market share movement over the last few years” Mehta told CNBC-TV18 on Monday.

“Companies that have been doing the right things in terms of gaining market shares for the past two to three years, I think this correction does provide an interesting opportunity to buy them. The trends with respect to premiumisation of motorcycles and scooterisation are two trends that will continue in the two wheeler industry and from that point of view players that are strong both in scooters and in premium motorcycles should be bought in this correction” Mehta said.

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First Published:Jul 23, 2018 12:38 PM IST