The auto exports market is doing well, Ashwin Patil, LKP Securities told CNBC-TV18. However, he added that the rural story is not playing out for the tractor industry. Patil also said that low single-digit growth is expected for the tractor industry.

Share Market Live

NSE

Escorts Ltd' domestic tractor sales were down 17 percent at 26,094 per cent in November, as compared to 31,619 units in the same month last year. However, exports were up 43 per cent at 1,587 units, as against 1,107 units in November last year.

"For Mahindra and Mahindra, Escorts the rural story is not playing out. We have seen that for the last year, the tractor industry grew by about 26.7 percent and that's a huge base. Therefore, it will be very unjust to expect very strong growth from that quarter this year. So, going by that, I would say that lower single digit growth can be expected from tractors," he said.

Mahindra & Mahindra Ltd on Wednesday reported a 15 percent decline in total tractor sales at 27,681 units in November 2021. The company had sold 32,726 units in the same month last year, M&M said in a statement.

Also Read: November retail auto sales disappoint, details here

Domestic tractor sales were down 17 percent at 26,094 in November, as compared to 31,619 units in the same month last year, it added. However, exports were up 43 percent at 1,587 units, as against 1,107 units in November last year.

“This year, the monsoon got delayed, it was there up till the middle of October, right now also the unseasonal monsoons are there. So, on the back of that, the harvest has got delayed, and that's the main reason why the two-wheelers, as well as the tractors, are impacted. I would say it's a temporary phenomenon and going forward, we won't be able to see such kind of declines," he said.

Patil added that LKP Securities preferred Bajaj Auto and Hero MotoCorp in the two-wheeler space and Ashok Leyland & Tata Motors in the commercial vehicles space.

Sales of Ashok Leyland declined by two percent YoY. It sold 10,480 units against 10,659 units in November 2020. Further, the domestic sales fell by four percent YoY.

Catch latest stock market updates here

First Published:Dec 2, 2021 11:12 AM IST