LAHORE-Tractors sale in the country posted a decent growth of 150 per cent annually in Feb 2015 due to peak demand before Kharif season, while car sales of local assemblers jumped by 36% to reach at 17,356 units in the same month. According to latest data, during 8MFY15, sales clocked-in at 102,491 units up 17% compared to 87,951 units in the same period last year led by Toyota Corolla new model and invoicing of Taxi Scheme.
Total tractors sales during 8MFY15 increased to 28,412 units up 34% as compared to 21,172 units in the same period last year.
Healthy growth in auto sector is indicative of increase in per capita income, improved farmer economics and overall economy recovery. Car financing is also picking up gradually (currently estimated at 30), thanks to declining interest rates Reduction in General Sales Tax (GST) on tractors, Taxi scheme and new model of Corolla are playing important role in enhancing overall auto sales.
Millat Tractors and Al Ghazi sold 2,435 units in Feb 2015 compared to 1,060 units in the same month last year. On month-on-month basis, MTL sales increased by 13% in Feb 2015 from 2,154 units in Jan 2015. During 8MFY15, sales of MTL surged significantly by 37% to 17,400 units mainly due to reduction in GST announced in last Federal budget. AGTL sold 1,503 units in Feb 2015 compared to 545 units in the same month last year. On month-on-month basis, AGTL sales increased by 15% in Feb 2015 from 1,310 units in Jan 2015.
In FY15, experts estimate that local car assembler’s sales will grow by 24% to 169,876 units while 30% growth in tractors sales is also expected. Volumetric growth coupled with weaken yen will have positive impact on the profitability of auto sector.
Amongst individual companies, PSMC sales increased by 44% YoY to 9,981 units in Feb 2015. Volumes also improved by 25% on Month-on-Month basis. During 8MFY15, sales of PSMC rose to 53,669 units versus 49,522 units in the same period last year. We attribute this improvement to the invoicing of cabs under the ‘Taxi scheme’.
Indus Motors sold 5,077 units in Feb 2015 compared to 3,505 units in the same month last year. On MoM basis, INDU sales decreased by 21% from 6,415 units in Jan 2015. During 8MFY15, sales increased by 52% to 34,375 units. Corolla new model is sold out for next 3-4 months according to our contacts in the industry.
Honda Cars sold 2,242 units in Feb 2015 compared to 2,232 units in the same month last year. On Month-on-Month basis, HCAR sales decreased by 30% in Feb 2015 from 3,221 units in Jan 2015.
In 8MFY15, sales of HCAR have now registered a decline of 5% to 14,041 units mainly due to the introduction of Corolla’s new model in July 2014.