Led by new launches from Honda (Dio), Hero (Maestro), TVS (Pep+) and Suzuki (Swish), the scooter segment grew at a faster clip of 32.4%YoY in the month of Oct'12 as against the 6.7% YoY growth in the motorcycle segment. For April-Oct’12, the scooter segment registered a growth of 22.3%, with an estimated growth of 16.7% for FY13E.
The faster volume growth of the scooter segment lead to a 300 bps improvement in its share to 21.0% of the two-wheeler market for YTD FY13E.
For the month of Oct'12, motorcycle segment grew by 6.7% YoY despite flattish volumes by Hero Motocorp (HMCL). This was mainly on account of 69.4% YoY growth registered by HMSI. For April-Oct'12, the segment reported flattish numbers, with an estimated growth of 4.0% for FY13E led by the new launches.
Commenting on the sector, stock broker Prabhudas Lilladher said, ''We believe Bajaj Auto is likely to outperform Hero Motocorp (HMCL) in the near-to-medium term. With exports, three-wheeler and spares accounting for around 50% of its FY14E turnover, we believe Bajaj Auto's margins are set to improve. With earnings CAGR of 9.0% as against 6.5% for HMCL for FY12- FY14E period, we believe the valuations at 14.5x FY14E EPS for Bajaj Auto seems attractive as against similar valuation for HMCL. Maintain 'Accumulate' on Bajaj Auto and 'Reduce' on HMCL."