Tata Motors Commercial Vehicles (CV) domestic sales continued to grow in October 2018 at 39,420 units, higher by 22%, over last year October, led by the continued acceptance of the BS4 products. Cumulative sales for the fiscal (April-October 2018) at 271,907 have grown by 40% over last year same period.

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PSR Analysis: The commercial vehicle industry has been firing on all cylinders for quite some time now. Every manufacturer has recorded significant growth – between 40-70 percent – in its H1 heavy-duty trucks sales. While it is predictable that the robust percent growth was not sustainable for the full fiscal, it was estimated that the growth will moderate; however, October numbers indicate that the growth is still on a higher plane.

In such a buoyant environment, CV market leader Tata Motors, which is engaged in an aggressive battle to win back lost ground in the heavy-duty truck segment, seems to be playing its cards well. To support this; in the year till now, freight rates have seen some uptick. This is also helped by higher spend on infra projects. NHAI road contracts, awarded last year, are currently under execution in various parts of the country. Also, affordable housing and irrigation projects are contributing to the incremental demand for M&HCVs. With the upswing in infrastructure projects across the country, there is increasing demand for tippers which is likely to continue.

However, at end of the day, the CV industry is cyclical and being mindful of that, the CV growth momentum is likely moderate in following months.