Auto stocks fell up to 8% on Thursday, October 1, after companies shared their September sales numbers. Bajaj Auto led the losses as exports dropped below 2.5 lakh units. While Force Motors saw sales grow over 50%, many other firms like Mahindra & Mahindra and Escorts Kubota faced a tough day.
Explained - Why Auto stocks, led by Bajaj fell up to 8% after their September sales numbers
Force Motors' total sales were up over 50% from last year in September. This was the second month in a row that sales have grown by 50%, while Bajaj Auto's exports fell below the mark of 2.5 lakh units for the first time in four months.
Auto stocks that came out with their September sales figures on Thursday, October 1, are all trading with losses of up to 8%. Bajaj Auto is leading the losses, followed by declines seen in shares of Mahindra & Mahindra, Escorts Kubota, and SML Mahindra.
Why Bajaj Auto Shares Fell 8% on Thursday?
Shares of Bajaj Auto fell nearly 7.5% on Thursday after reporting weak sales figures for October.
Domestic sales declined 9% on a year-on-year basis, while exports were lower than expectations, despite a 32% jump from last year. In fact, Bajaj Auto's exports fell below the 2.5 lakh units mark for the first time in four months.
Total two-wheeler sales were up 5% led by exports, while domestic two-wheeler sales were down 12%. Three-wheeler sales were down 9% year-on-year.
Why Mahindra & Mahindra Shares declined on Thursday?
M&M's auto sales in September sales were largely in-line with expectations, while tractor sales were lower, on expected lines.
M&M's overall sales were up 15% from last year, compared to the CNBC-TV18 poll of 16%. SUV sales growth stood at 14%, while LCV sales for the 2-3.5 tonne category rose 13% year-on-year.
Tractor sales for M&M fell 21%, much higher than the 11% estimate. Tractor sales fell to 52,100 unit, compared to 66,111 units last year.
Shares of Mahindra & Mahindra are down 2.2% at 2,885.
Strong Sales From Force Motors
Force Motors' total sales were up over 50% from last year in September. This was the second month in a row that sales have grown by 50%.
The overall September sales figure of 4,101 units was the highest in a month for the company since March. Domestic sales were up 62% from last year at 4,027 units.
Shares of Force Motors opened higher but are now trading with losses of 0.8% at ₹16,910. The stock is down 19% so far this year.
Escorts Kubota
The tractor manufacturer reported a 16.7% drop in its overall sales in September to 15,214 units, while exports were down 35% from last year to 303 units.
Domestic tractor sales at 14,911 units were down 16% from last year.
Shares of Escorts Kubota are down 3% on Thursday at ₹2,634.2. The stock is down 31% so far this year.
Why Is Hyundai Motor India Bucking The Trend?
While most other Auto stocks are declining after reporting their monthly sales figures, those of Hyundai Motor India are bucking the trend, rising as much as 1% after their monthly sales figures.
Hyundai Motor India's overall sales in September grew by 11% from last year, while the poll was for a growth of 6%. Domestic sales were up 11% year-on-year, while exports saw growth of 10.4%.