Dashboard
The Monthly Auto Update
January 2016
Data Track:
December 2015 volume update of auto majors
Sector overview and outlook ........................................................ 2
Hero MotoCorp ............................................................................. 3
Bajaj Auto ......................................................................................4
HMSI ............................................................................................. 6
TVS Motor ..................................................................................... 6
Maruti Suzuki .................................................................................8
Mahindra & Mahindra ................................................................. 10
Tata Motors ................................................................................. 12
Ashok Leyland .............................................................................. 14
Eicher Motors .............................................................................. 15
Two-wheelers .............................................................................. 16
Three-wheelers ........................................................................... 18
Cars and UVs ................................................................................ 20
Commercial vehicles..................................................................... 22
Speedometer
Dec 2015 relative performance
105
100
95
90
1-Dec
MOSL Auto Index
Sensex
Sector Gauge:
November 2015 update
11-Dec
21-Dec
31-Dec
12-month relative performance
MOSL Auto Index
Sensex
122
108
94
80
Dec-14
News and developments
Renault to pitch Kwid against Maruti's Alto; plans to launch new
versions in February………………………………………………………………….24
Hyundai's India unit set to close 2015 with record numbers; Creta
sees bookings for 75,000 units ……………………………………………….. 24
Other Auto news….……………………………………………………………….. 24
Mar-15
Jun-15
Sep-15
Dec-15
Comparative valuation
Auto OEM's
Bajaj Auto
Hero MotoCorp
TVS Motor
M&M
Maruti Suzuki
Tata Motors
Ashok Leyland
Eicher Motors#
# Nos. are on CY basis
CMP
(INR)*
2,488
2,646
286
1,244
4,583
377
92
17,506
Rating
Buy
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
TP
(INR)
2,923
3,050
326
1,265
5,428
473
99
21,196
P/E (x)
FY16E
FY17E
20.2
16.0
16.5
13.9
29.0
17.8
19.7
15.7
26.9
20.4
10.7
8.2
25.4
13.3
52.4
32.3
EV/EBITDA (x)
FY16E FY17E
12.6
10.5
10.5
8.9
17.5
11.5
15.0
13.1
13.2
10.8
3.7
3.1
12.1
7.5
28.5
18.3
RoE (%)
FY16E FY17E
31.4
34.8
43.9
42.3
25.8
33.2
15.7
15.7
18.4
20.8
18.2
18.8
18.9
30.1
32.8
40.3
RoCE (%)
EPS CAGR (%)
FY16E FY17E
FY16E-18E
45.1
46.5
17.0
61.2
57.8
18.2
24.6
32.7
39.1
17.3
17.7
10.8
25.7
28.0
31.9
16.8
17.1
31.4
20.0
30.8
59.8
34.8
46.2
49.5
Source: Company, MOSL
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on
www.motilaloswal.com/Institutional-Equities,
Bloomberg, Thomson Reuters, Factset and S&P Capital.
Jinesh Gandhi
(Jinesh@MotilalOswal.com); +91 22 3982 5416

Dashboard
Data Track
Sector overview and outlook
CV recovery continues, PVs benefiting from new launches
M&HCV recovery on back of replacement demand; 2Ws under pressure on
weak rural demand
We expect demand momentum to pick up further pace in 2HFY16 on government
reforms initiatives and on interest rate cycle turning favorable. Lead indicators of CV
industry such as freight rates, fleet operators’ utilization and further correction in
fuel prices are positive factors for CV. LCVs also are showing initial signs of
bottoming out with moderate growth, passenger LCV has shown a growth of 9%
YoY. 2W demand is slowing down, especially in rural markets, with motorcycle sales
down 2% YoY in FY16YTD, while scooters continue grew at ~10%. Tractors (M&M)
de-grew by ~13% in FY16YTD, impacted by deficient rainfall in most part of country.
Fuel price deflation and moderating interest rate to drive PVs and CVs
demand
Fuel price deflation, currently at multi-year low, coupled with improving macro
environment and new launches before start of festive season would help in reviving
PV demand, especially for entry level cars and compact SUVs. While CV demand
would be function of improvement in freight availability, however, improving fleet
operators’ health (due to moderating cost pressures and improvement in demand)
has kick started replacement cycle, which got deferred by 2-3 years.
Product lifecycle key factor to off-set competitive forces
Competitive intensity is expected to remain high across segments, especially in PVs
and CVs, with several launches from challengers and incumbents. While volume
recovery would be witnessed across segments, benefit of the same would differ
from player to player depending on their product lifecycle and competitive intensity.
Valuation and view
Demand environment and changing competitive landscape in the auto sector would
be the key determinants of stock performance. Prefer
Maruti Suzuki, Bajaj Auto
and Tata Motors
in large caps and
Ashok Leyland, Eicher Motors and TVS Motor
in
mid-caps.
January 2016
2

Dashboard
Data Track
Hero MotoCorp
Below estimate at 499,665 units down 5% YoY
Snapshot of volumes for December 2015
Dec-15
Total volume
Dec-14 YoY (%)
-5.0
Nov-15
550,731
MoM
FY16-YTD
(%)
-9.3
FY15-YTD
Chg
(%)
FY16
estimate
Resi- Residual FY16 YTD
YoY
dual Gr. Monthly Monthly
(%)
(%) Run rate Run rate
0.9
13.0 593,417
545,622
499,665 526,097
4,910,602 5,056,218
-2.9 6,690,853
Source: Compa ny, MOSL
Highlights
HMCL's Dec-15 volumes were down 5% YoY (-9.3% MoM) to 499,665 units
(v/s est 531,358 units).
We estimate flat volumes for FY16, implying residual growth of 13% or
~593k units.
The stock trades at 17/14.3x FY16/17 EPS of ~INR156/185. Maintain
Buy.
Hero MotoCorp: two-wheelers
FY13
690,000
625,000
560,000
495,000
430,000
365,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
FY14
FY15
FY16
HMCL reports flat
volumes YoY
Source: Company, MOSL
Bl oomberg
Equi ty Sha res (m)
CMP (INR)
1,6,12 Rel . Perf. (%)
M.Ca p. (USD b)
HMCL IN
200
2,646
0/4/-13
8.1
52-Wk Ra nge (INR) 3,149/2,252
January 2016
3

Dashboard
Data Track
Bajaj Auto
Dec-15 in-line estimate; Export volumes down ~12% YoY, Domestic
volumes up 16.6% YoY
Snapshot of volumes for December 2015
Dec-15
Total volume
Motorcycles
Three-Wheelers
Domestic
Exports
289,003
247,782
41,221
143,526
145,477
Dec-14 YoY (%)
289,244
246,233
43,011
123,110
166,134
-0.1
0.6
-4.2
16.6
-12.4
Nov-15
309,673
270,886
38,787
172,358
137,315
MoM
FY16-YTD
(%)
-6.7
-8.5
6.3
-16.7
5.9
3,021,123
2,605,733
415,390
1,614,041
1,407,082
FY15-YTD
3,028,532
2,619,115
409,417
1,577,058
1,451,474
Chg
(%)
-0.2
-0.5
1.5
2.3
-3.1
FY16
estimate
4,009,544
3,459,873
549,671
2,211,560
1,797,984
Resi- Residual FY16 YTD
YoY
dual Gr. Monthly Monthly
(%)
(%) Run rate Run rate
5.2
5.1
5.9
10.3
-0.4
26.3
26.9
22.4
39.6
10.2
329,474
284,713
44,760
199,173
130,301
335,680
289,526
46,154
179,338
156,342
Source: Compa ny, MOSL
Highlights
BJAUT’s Dec-15 sales in-line at 289,003 units (v/s est 286,004), flat YoY (-6.7%
MoM). We estimate overall volumes to grow by ~5% in FY16, implying ~26%
residual growth or ~329,474 units.
Domestic volumes at ~143,526 units (v/s est 154,437 units), up 16.6% YoY (-17%
MoM).
Exports at ~145,477 units (v/s est 131,566 units) down 12.4% YoY (6% MoM), we
expect a flat growth in FY16 implying residual growth of 10% or 130,301 units.
Motorcycle volumes flat YoY (-8.5 MoM) to 247,782 units (v/s est ~244,031
units). We estimate 5% growth in FY16, implying ~27% residual growth or
~284,713 units.
3W volumes de-grew by 4.2% YoY (+6.3% MoM) to 41,221 units (v/s est 41,973
units). We estimate 6% growth in FY16, implying ~23% residual growth to
44,760 units.
The stock trades at 20.2x/16x FY16E/17E EPS. Maintain
Buy.
January 2016
4

Dashboard
Two-wheeler volumes (units)
375,000
FY13
FY14
FY15
FY16
Motorcycle volume
recovery underway driven
by new launches in
domestic and exports
normalizing
310,000
245,000
180,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Three-wheeler volumes (units)
59,000
52,000
FY13
FY14
FY15
FY16
3W volumes down by
4% YoY
45,000
38,000
31,000
24,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Export volumes (units)
200,000
FY13
FY14
FY15
FY16
160,000
Exports down 12% YoY
120,000
80,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Market mix
100%
75%
Domestic
Exports
Share of exports stable
50%
25%
0%
January 2016
5

Dashboard
Data Track
TVS Motor
In-line; Scooters continue to deliver strong performance up 21% YoY
Snapshot of volumes for December 2015
Dec-15
Total volume
Motorcycles
Scooters
Mopeds
Three-Wheelers
Domestic
Exports
202,086
71,435
65,090
57,541
8,020
169,315
32,771
Dec-14
YoY
(%)
chg
Nov-15
MoM
FY16-YTD FY15-YTD
(%) chg
-10.3 2,018,973 1,913,095
-13.1 769,564 730,235
-14.4 615,465 533,474
-3.3
544,568 568,330
4.2
89,376
81,056
-11.7 1,665,171 1,605,522
-2.5
353,802 307,573
(%)
chg
FY16
estimate
Gr.
(%)
Resi- Residual FY16 YTD
dual Monthly Monthly
Gr. (%) Run rate Run rate
22.9
23.6
28.8
-1.4
58.8
26.1
6.1
247,574
93,948
74,488
64,675
14,464
209,287
38,287
224,330
85,507
68,385
60,508
9,931
185,019
39,311
194,481 3.9 225,401
70,573 1.2
82,163
53,613 21.4 76,043
60,288 -4.6 59,500
10,007 -19.9 7,695
161,512 4.8 191,780
32,969 -0.6 33,621
5.5 2,761,694 9.7
5.4 1,051,407 9.7
15.4 838,928 18.7
-4.2
738,593 -3.5
10.3 132,767 22.5
3.7 2,293,031 9.0
15.0 468,663 12.7
Source: Compa ny, MOSL
Highlights
TVS Motor aims 18%
market share and double
digit margins over next
three years
TVS Motor's December-15 sales were in-line at 202,086 units (v/s est
204,402 units), a growth of ~4% YoY (-10% MoM). We estimate overall
volume growth of ~10% in FY16, implying residual growth of ~23% or run-
rate of ~248k units.
Scooters volumes grew 21.4% YoY to 65,090 units (v/s est 65,514 units). We
estimate 19% growth in scooters volumes in FY16, implying residual growth
of 29% or 74,488 units.
Motorcycle volumes grew by 1.2% YoY to 71,435 units (est 73,697 units).
We estimate ~10% growth in Motorcycles in FY16 implying residual growth
rate of ~24% or ~94k units.
Mopeds decline 5% YoY to 57,541 units (est 57,316 units). We estimate 3.5%
de-growth for FY16 implying residual run-rate of 64,675 units.
3Ws de-grew by 20% YoY to 8,020 units (est 7,875 units). We estimate
~22.5% growth in 3Ws in FY16 implying residual growth rate of ~60% or
14,464 units.
Exports flat YoY at 32,771 units (est 31,056 units).
The stock trades at 29x/17.8x FY16E/FY17E EPS of ~INR9.9/INR16. Maintain
Buy.
Bl oomberg
Equi ty Sha res (m)
52-Week Ra nge (IN
1,6,12 Rel . Perf. (%)
M.Ca p. (INR b)
M.Ca p. (USD b)
TVSL IN
475.1
322/201
-6/11/4
136.1
2.1
TVS Motor Company Ltd: Valuation summary
Year
Net Sales
PAT
EPS
EPS
End
(INR m) (INR m) (INR)
Gr. (%)
03/14A
79,619
2,607
5.5
44.0
03/15A
100,982
3,478
7.3
33.4
03/16E
116,440
4,686
9.9
34.7
03/17E
145,426
7,630
16.1
62.8
P/E
(X)
52.2
39.1
29.0
17.8
P/BV
(X)
9.6
8.3
6.9
5.2
RoE
(%)
19.7
22.7
25.8
33.2
RoCE
(%)
20.3
21.9
24.6
32.7
EV/
EBITDA
29.2
24.0
17.5
11.5
January 2016
6

Dashboard
Motorcycle volumes (units)
110,000
FY13
FY14
FY15
FY16
Motorcycle grew
by ~1.2% YoY
98,000
86,000
74,000
62,000
50,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Scooters and mopeds (units)
168,000
150,000
132,000
FY13
FY14
FY15
FY16
Strong growth continues
114,000
96,000
78,000
60,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Sales mix
Motorcycles
100%
75%
50%
25%
0%
Scooters & Mopeds
January 2016
7

Dashboard
Data Track
Maruti Suzuki
Dec-15 in-line at 119k (v/s est 117k), a growth of ~8.5%; We estimate
December Retails sales growth of ~5% to 165k units
Snapshot of volumes for December 2015
Dec-15
Total volume
Domestic
C (Vans)
A2 (Compacts)
A3 (Sedan)
UV (Ertiga, S-Cross
Export
Dec-14
YoY
(%)
8.5
13.5
3.3
17.2
-4.6
58.8
-33.1
Nov-15
120,824
110,599
12,432
65,107
24,372
8,688
10,225
MoM
FY16-YTD
(%)
-1.4 1,068,846
0.7
971,958
-10.5 107,581
9.2
583,468
-18.1 216,985
5.5
63,924
-23.6
96,888
FY15-YTD
945,703
853,532
95,791
534,579
173,477
49,685
92,171
Chg
(%)
FY16
estimate
Resi- Residual FY16 YTD
YoY
dual Gr. Monthly Monthly
(%)
(%) Run rate Run rate
10.2
8.7
127,376
114,896
118,761
107,995
119,149 109,791
111,333 98,109
11,122 10,771
71,088 60,657
19,955 20,907
9,168
5,774
7,816
11,682
13.0 1,450,974 12.3
13.9 1,316,646 12.5
12.3
9.1
25.1
28.7
5.1 134,327 10.4
26.8
12,480
10,765
Source: Compa ny, MOSL
Highlights
MSIL's Dec-15 wholesale in-line at ~119,149 units (v/s est 117,726 units).
We estimate overall volume growth of 12.3%, implying ~10% residual
growth and required run-rate of 127k.
Domestic volumes grew ~13.5% to 111k (v/s est 106k). We estimate retails
volumes in Dec-15 at ~165k, up ~5% YoY. Inventory at the end of Dec-15
would be under 15 days.
We estimate domestic volume growth of ~12.5% in FY16 for MSIL, implying
~9% residual growth or ~115k monthly run-rate.
Compact segment (ex Dzire) grew ~17%, despite Baleno launch. A3 (Sedan)
segment declined by ~18%.
Exports down ~33% to 7,8716 units (v/s est 11,250 units).
The stock trades at 26.9x/20.4x FY16E/17E consolidated EPS of
~INR171/225. Maintain
Buy.
Bl oomberg
Equi ty Sha res (m)
CMP (INR)
52-Wk Ra nge (INR)
1,6,12 Rel .Perf.(%)
M.Ca p. (USD b)
MSIL IN
302.1
4,583
4,789/3,321
2/16/39
21.2
Maruti Suzuki: Financial & Valuation Summary
Year
Total Inc.
PAT Con. EPS EPS Con. P/E
End
(INR m) (INR m) (INR) Gr. (%)
(x)
3/14A
437,918 27,830
94.4
15.5
48.5
3/15A
499,706 37,112 127.5
35.0
35.9
3/16E
578,354 50,102 170.7
33.9
26.9
3/17E
699,209 66,277 224.6
31.6
20.4
P/CE
(x)
28.0
21.9
17.5
14.1
P/BV
EV/
RoE
(X) EBITDA (%)
6.6
24.9
13.3
5.8
18.7
15.7
5.1
13.1
18.4
4.3
10.3
20.8
RoCE
(%)
16.5
20.8
25.7
28.0
January 2016
8

Dashboard
Monthly volumes (units)
140,000
FY13
FY14
FY15
FY16
Strong growth momentum
continues for MSIL
115,000
90,000
65,000
40,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Export volumes (units)
20,000
FY13
FY14
FY15
FY16
Exports were down 33%
YoY
15,000
10,000
5,000
0
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Market mix
Domestic Sales
100%
75%
50%
25%
0%
Exports
January 2016
9

Dashboard
Data Track
Mahindra & Mahindra
Below estimates, Tractors disappoint; UV sales (incl. pick-ups in-line)
Resi- Residual FY16 YTD
YoY
dual Gr. Monthly Monthly
(%)
(%) Run rate Run rate
3.2
6.5
25.0
62.5
3.0
-3.5
22.1
14.8
5.7
72.8
19.5
43.9
65,861
40,833
919
214
5,374
18,521
58,207
33,435
932
215
4,705
18,919
Snapshot of volumes for December 2015
Dec-15
Total volume
50,783
UV (incl. pick-ups) 32,594
LCV
935
Verito (Logan)
209
Three-Wheelers
4,177
Tractors
12,868
Dec-14 YoY (%)
48,802
31,206
843
167
4,112
12,474
4.1
4.4
10.9
25.0
1.6
3.2
Nov-15
63,307
35,711
787
173
4,920
21,717
MoM
FY16-YTD
(%)
-19.8
-8.7
18.8
21.0
-15.1
-40.7
523,859
300,918
8,388
1,938
42,345
170,270
FY15-YTD
537,083
290,865
6,307
1,216
43,274
195,421
Chg
(%)
-2.5
3.5
33.0
59.4
-2.1
-12.9
FY16
estimate
721,443
423,417
11,144
2,581
58,467
225,834
Source: Compa ny, MOSL
Highlights
Dec-15 volumes grew 4% YoY to ~40,783 units (v/s est 55,578 units), driven
by ~4.4% YoY growth in UVs and ~3.2% growth in tractors. We estimate
growth of ~3.2% in FY16, implying 22% residual growth or ~65,861 units.
Tractor volumes grew by 3.2% YoY to 12,868 units (v/s est 16,216 units),
despite very low base of last year. MM's tractor business has favorable base
from Nov-14, resulting in strong growth in 2HFY16. We are assuming 3.5%
de-growth in volumes for FY16, implying a residual growth of ~44% or
18,521 units.
UV (incl pick-ups) grew by ~4.4% YoY to 32,594 units (in-line), driven by
TUV3OO launch. We estimate 7% growth in FY16 for UVs driven by new
product launches (3 new platforms and 3 major upgrades), implying residual
monthly run-rate of 40,833 units or ~15% residual growth.
Speaking on the monthly performance, Pravin Shah, Chief Executive,
Automotive Division, M&M. said, "Inspite of a challenging external
environment, we at Mahindra have closed December on a positive note.
Having been encouraged with the positive response to our upcoming
KUV1OO, we are excited about this compact SUV launch on 15th January,
especially with our first mFalcon petrol offering. We are delighted woth our
exports performance during December which has grown by 65%."
Commenting on the monthly performance, Rajesh Jejurikar, President &
Chief Executive, Farm Equipment and Two Wheeler Division, Mahindra &
Mahindra Ltd. said, "We have sold 11,686 tractors in December 2015 in the
domestic market. we are happy to see the growth trend continue into
December. In exports we sold 1,182 units in December."
The stock trades at 19.7x/15.7x FY16E/17E consolidated EPS. Maintain
Neutral.
Mahindra and Mahindra: Financial & Valuation Summary
Bl oomberg
MM IN
Equi ty Sha res (m)
591.4
CMP (INR)
1,244
52-Wk Ra nge (INR) 1441/1095
1,6,12 Rel .Perf.(%)
-8/-4/2
M.Ca p. (USD b)
11.3
Year Net Sales S/A PAT * S/A EPS * Cons. Con. EPS
End (INR m) (INR m)
(INR) EPS (INR) Gr (%)
3/14A 405,085 38,605
64.5
72.7
19.3
3/15A 389,454 31,595
52.8
47.8
-34.2
3/16E 418,376 36,766
61.4
63.3
32.3
3/17E 478,515 41,475
69.3
79.3
25.3
* S/A i ncl udi ng MVML
P/E Cons.
(x) P/E (x)
19.3 17.1
23.6 26.0
20.3 19.7
18.0 15.7
RoE
(%)
22.1
15.9
15.7
15.7
RoCE EV/
EV/
(%) Sales (x) EBITDA
20.3
1.8
15.4
16.3
1.9
17.7
17.3
1.8
15.0
17.7
1.5
12.8
January 2016
10

Dashboard
Utility vehicle volumes (units)
48,000
39,000
FY13
FY14
FY15
FY16
UV volumes show early
signs of recovery
30,000
21,000
12,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Tractor volume (units)
FY13
44,000
36,000
28,000
20,000
12,000
4,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
FY14
FY15
FY16
Tractors volumes
decline YoY
Product mix
100%
75%
UVs
Tractors
LCVs, 3-wheelers
Cars
Tractors and UVs dominate
the segment mix
50%
25%
0%
January 2016
11

Dashboard
Data Track
Tata Motors
In-line estimates at ~39,973 units (-4% YoY), driven by CVs; LCVs positively
surprise, back on growth path after 31 months
Snapshot of volumes for December 2015
Dec-15
Total volume
HCV's
LCV's
Cars
UV's
of which exports
39,973
14,123
17,424
7,240
1,186
4,557
Dec-14 YoY (%)
41,734
13,622
15,929
10,057
2,126
3,958
-4.2
3.7
9.4
-28.0
-44.2
15.1
Nov-15
38,918
12,724
15,586
9,254
1,354
3,573
MoM
FY16-YTD
(%)
2.7
11.0
11.8
-21.8
-12.4
27.5
364,946
122,476
143,258
84,748
14,464
27,900
FY15-YTD
362,868
100,202
167,670
75,031
19,965
22,941
Chg
(%)
0.6
22.2
-14.6
13.0
-27.6
21.6
FY16
estimate
507,571
169,047
193,218
124,610
20,695
Resi- Residual FY16 YTD
YoY
dual Gr. Monthly Monthly
(%)
(%) Run rate Run rate
1.1
18.4
-12.9
11.3
-19.2
2.4
9.5
-7.7
7.9
10.2
47,542
15,524
16,653
13,287
2,077
40,550
13,608
15,918
9,416
1,607
Source: Compa ny, MOSL
Highlights
LCV & UVs volumes
remains under pressure
Tata Motors Dec-15 sales volumes de-grew 4% YoY to 39,973 units (v/s est
39,505 units). We estimate overall volume growth of ~1% in FY16, implying
residual growth of ~2% or run-rate of ~47.5k units.
HCV sales (incl exports) grew just ~4% YoY to 14,123 units (v/s est 13,622
units), as base normalizes from Dec-14 onwards. We estimate ~18.4% HCV
growth in FY16, implying 9.5% residual growth or run-rate of ~15,524 units.
LCV sales (incl exports) grew for the first time after 31 months of decline,
with ~9% YoY growth to 17,424 units (est ~14,734 units). We estimate de-
growth of 13% in LCVs in FY16, implying residual run-rate of ~16,653 units.
Car sales (incl exports) witnessed de-growth of 28% YoY (-22% MoM) to
7,240 units (est 9,554 units), as Dec-14 base was high due expected increase
in excise duty by ~4% from Jan-15. We estimate growth of 11% in passenger
cars in FY16, implying 8% residual growth or ~13,287 units.
UV sales (incl exports) were at 1,186 units (est 1,595 units), a de-growth of
44% YoY. We estimate decline of 19% in UV volumes in FY16, implying
residual run-rate of 2,077 units.
The stock trades at 10.7x/8.2x FY16E/17E consol. EPS respectively. Maintain
Buy.
Bl oomberg
TTMT IN
Actua l Eq. Sh (m)
3,395.9
CMP (INR)
377
52-Week Ra nge (INR) 606/279
1,6,12 Rel . Perf. (%) -4/-7/-19
M.Ca p. (USD b)
19.1
January 2016
12

Dashboard
M&HCV volumes (units)
FY13
22,000
16,000
10,000
4,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
FY14
FY15
FY16
Volumes to improve further
with economic activity
picking up
LCV volumes (units)
48,000
FY13
FY14
FY15
FY16
LCV volumes show early
signs of recovery
40,000
32,000
24,000
16,000
8,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Car volumes (units)
23,000
17,000
11,000
5,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
FY13
FY14
FY15
FY16
Product mix in the CV segment
100%
75%
50%
25%
0%
LCVs
M&HCVs
January 2016
13

Dashboard
Data Track
Ashok Leyland
December-15 above estimate, with 31% YoY growth; M&HCV continues to
grow at 35% YoY and LCVs grew at 18% YoY
Snapshot of volumes for December 2015
Dec-15
Total volume
CV (ex LCV)
LCV (Nissan JV)
12,209
9,758
2,451
Dec-14 YoY (%)
9,290
7,210
2,080
31.4
35.3
17.8
Nov-15
8,971
6,297
2,674
MoM
FY16-YTD
(%)
36.1
55.0
-8.3
96,511
74,561
21,950
FY15-YTD
30.2
32.5
23.0
Chg
(%)
36.5
45.2
13.4
Resi- Residual FY16 YTD
FY16 YoY
dual Gr. Monthly Monthly
estimate (%)
(%) Run rate Run rate
136,581
105,131
31,450
30.2
32.5
23.0
17.1
9.2
52.9
13,357
10,190
3,167
10,723
8,285
2,439
Source: Compa ny, MOSL
Highlights
Ashok Leyland reported sales volume growth of ~31% YoY (36% MoM) in
December-15 sales volumes to 12,209 units (v/s est. 10,171 units). We
estimate ~30% growth in FY16, implying 17% residual growth or ~13,537
units.
MHCV volumes grew 35% YoY to 9,758 units (v/s est 7,571 units).
Management has indicated 15-20% growth for the company in FY16, based
on 10-15% industry growth. We estimate 32.5% growth in FY16, implying
residual growth of 9% or ~10,190 units.
LCV (Dost & Stile) continues to be on recovery path with a growth of 18%
YoY (-8.3% MoM) to 2,451 units (v/s est 2,600 units). We estimate ~23%
growth in LCVs volumes for FY16 implying residual growth rate of 53% or
~3,167 units.
The stock trades at 24x/12.8x FY16E/FY17 EPS. Maintain
Buy.
Trend in M&HCV voulmes (units)
FY13
14,000
11,000
8,000
5,000
2,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
FY14
FY15
FY16
Source: Company, MOSL
Bl oomberg
Equi ty Sha res (m)
CMP (INR)
52-Week Ra nge
1,6,12 Rel . Perf. (%)
M.Ca p. (INR b)
M.Ca p. (USD b)
AL IN
2,845.8
92
100/43
-5/29/76
262
4.0
January 2016
14

Dashboard
Data Track
Eicher Motors
Royal Enfield volumes at ~40,453 (in-line) impacted by heavy rains in
Chennai; VECV positive surprise
Highlights
Royal Enfield is targeting
sales of over ~600,000
units in CY16
RE volumes flat MoM (+46% YoY) to 40,453 units (in-line), impacted by
Chennai rains resulting in estimated loss of ~10,000 units in Dec-15.
The mgmt. maintained that bookings are growing faster than production,
with waiting period of 3.5 months (v/s 4.25 months in 2QCY15). This was
validated by our channel checks where old dealers reported 50-70%
bookings growth.
VECV's overall volumes grew ~46% YoY to 4,951 units (v/s est. 4,184 units).
Domestic sales were above estimate at 4,114 units (v/s est ~3,673 units)
grew 37% (42% MoM). LMD volumes grew ~21% YoY to 2,479 units (v/s est
2,419 units), whereas buses volumes grew 61% YoY to 719 units (v/s est 540
units). HD volumes grew by 82% YoY (50% MoM) to 916 (v/s 715 units).
We estimate domestic CV volumes to grow 30% in CY16.
Exports grew ~117% YoY (+33% MoM) to ~837 units (v/s est ~511 units).
The stock trades at 32.3x/23.3x CY16E/CY17E EPS of INR542/746
respectively. Maintain
Buy.
Royal Enfield volumes continues to show strong growth
CY15
CY12
CY13
CY14
CY15
VECV volumes showing recovery signs (YoY)
CY12
CY13
CY14
6,500
5,000
3,500
2,000
50,000
40,000
30,000
20,000
10,000
0
Bloomberg
Equity Shares (m)
1,6,12 Rel. Perf. (%)
M.Cap. (INR b)
M.Cap. (USD b)
EIM IN
27.0
7/-14/14
472.7
7.2
52-Week Range (INR) 21618/13930
Source: Company, MOSL
Eicher Motors: Financial & Valuation Summary
EPS
EPS
P/E P/BV
Year Net Sales PAT
End
(INR b) (INR b) (INR) Gr (%) (x)
(x)
12/13A
68.1
3.9
145.9
21.5 120.0 23.0
12/14A
87.4
6.2
227.1
55.6
77.1 18.9
12/15E 117.1
9.0
333.8
47.0
52.4 15.8
12/16E 162.9
14.7 542.2
62.4
32.3 11.0
E: MOSL Es ti ma tes
Source: Company, MOSL
RoE
(%)
20.7
26.9
32.8
40.3
RoCE
(%)
21.8
27.6
34.8
46.2
EV/EBITDA Div. Yld
(x)
(%)
85.4
0.2
49.1
0.2
30.2
0.2
18.8
0.3
January 2016
15

Dashboard
Sector Gauge
Two-wheelers
Motorcycle sales to remain under pressure on concerns over rural demand;
Scooters continue to see positive traction due to urban demand
Two-wheelers: Volume snapshot
Total Domestic 2W
% of Total 2W
Total Motorcycle
% of Domestic 2W
<125cc
% of Motorcycle
>125cc
% of Motorcycle
Scooters & Mopeds
% of Domestic 2W
Exports
% of Total 2W
Total 2W
Nov-15
1,313,700
87
860,392
65
699,789
81
160,603
19
453,308
35
188,755
13
1,502,455
Nov-14
1,301,254
85
853,077
66
692,113
81
160,964
19
448,177
34
228,510
15
1,529,764
YoY (%)
1.0
0.9
1.1
-0.2
1.1
-17.4
-1.8
Oct-15
1,655,170
90
1,065,652
64
844,963
79
220,689
21
589,518
36
189,698
10
1,844,868
MoM (%) FY16-YTD FY15-YTD
-20.6
11,086,917 10,910,698
87
86
-19.3
7,289,814 7,452,648
66
68
-17.2
5,844,617 6,019,155
80
81
-27.2
1,445,197 1,433,493
20
19
-23.1
3,797,103 3,458,050
34
32
-0.5
1,728,134 1,719,809
13
14
-18.6
12,815,051 12,630,507
Chg (%)
1.6
-2.2
-2.9
0.8
9.8
0.5
1.5
Source: Company,
MOSL
Two-wheelers: Domestic volume trend (units)
FY13
FY14
FY15
FY16
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
Demand momentum
continues to remain weak
Domestic market share in 2-wheelers
Hero MotoCorp
Bajaj Auto
HMSI
Yamaha
TVS Motor
100%
Market share for HMCL
improves on back of new
scooter launches
75%
50%
25%
0%
January 2016
16

Dashboard
Motorcycles: domestic volume trend
FY13
FY14
FY15
FY16
1,200,000
1,000,000
Pressure in entry level
Motorcycle segment due to
slowdown in rural demand
800,000
600,000
400,000
Motorcycles: domestic market share
Hero MotoCorp
Bajaj Auto
HMSI
Yamaha
TVS Motor
100%
75%
HMCL gains market share
on back of festive season
50%
25%
0%
Two-wheelers: Product mix
Motorcycle
Scooters & Mopeds
100%
Scooters market share
>25%
75%
50%
25%
0%
Two-wheelers: export volumes (units)
275,000
250,000
225,000
200,000
175,000
150,000
125,000
100,000
FY13
FY14
FY15
FY16
Exports again under
pressure
January 2016
17

Dashboard
Sector Gauge
Three-wheelers: Volume snapshot
Total Domestic 3W
% of Total 3W
Passenger
% of Domestic eW
Total Goods
% of Domestic 3W
<1T
% of Goods Vehicle
>1T
% of Goods Vehicle
Exports
% of Total 3W
Total 3W
Three-wheelers
Growth in domestic 3W post new permits opening up in 2HFY16
Nov-15
45,235
50
37,118
82
8,117
18
7,932
98
185
2
45,235
50
90,470
Nov-14
41,754
50
32,695
78
9,059
22
8,892
98
167
2
42,337
50
84,091
YoY (%)
8.3
13.5
-10.4
-10.8
10.8
6.8
7.6
Oct-15
52,361
50
43,164
82
9,197
18
9,000
98
197
2
52,361
50
104,722
MoM (%)
-13.6
-14.0
-11.7
-11.9
-6.1
-13.6
-13.6
FY16-YTD
306,703
47
290,658
95
16,045
5
14,923
93
1,122
7
351,436
53
658,139
FY15-YTD
376,275
57
311,129
83
65,146
17
63,646
98
1,500
2
284,727
43
661,002
Chg (%)
-18.5
-6.6
-75.4
-76.6
-25.2
23.4
-0.4
Source:
SIAM/MOSL
Three-wheelers: volume trend (including exports)
116,000
104,000
FY13
FY14
FY15
FY16
3Ws to grow at healthy rate
on back of exports
92,000
80,000
68,000
56,000
44,000
32,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Three-wheelers: domestic segment mix
100%
Passenger
Goods
Passenger segment
dominates three-wheelers
with over 75% contribution
75%
50%
25%
0%
January 2016
18

Dashboard
Three wheelers: passenger segment market share
100%
75%
Bajaj Auto
Piaggio
M&M
TVS
Others
Bajaj Auto continues to
dominate passenger
segment…
50%
25%
0%
Three wheelers: goods segment market share
100%
Bajaj Auto
Piaggio
M&M
Others
Piaggio continues to lead in
the goods segment
75%
50%
25%
0%
January 2016
19

Dashboard
Sector Gauge
Cars and UVs
New model launches to help maintain demand momentum
Nov-14
212,435
79
156,809
74
124,462
79
29,923
19
2,424
2
40,851
19
14,775
7
56,230
21
268,665
YoY (%)
11.2
10.4
10.9
-6.1
186.2
18.6
-0.7
-8.6
7.1
Oct-15
268,629
82
194,158
72
155,032
80
31,047
16
8,079
4
58,120
22
16,351
6
59,265
18
327,894
MoM (%)
-12.1
-10.8
-10.9
-9.5
-14.1
-16.7
-10.3
-13.3
-12.3
FY16-YTD
1,835,113
81
1,344,257
73
1,090,597
81
221,470
16
32,190
2
372,883
20
117,973
6
430,241
19
2,265,354
FY15-YTD
1,685,645
80
1,206,681
72
1,007,857
84
174,354
14
24,470
2
362,299
21
116,665
7
412,477
20
2,098,122
Chg (%)
8.9
11.4
8.2
27.0
31.5
2.9
1.1
4.3
8.0
Source:
SIAM/MOSL
Passenger vehicles: Volume snapshot
Nov-15
Total Domestic PVs
236,221
% of Total PVs
82
Total Cars
173,111
% of Domestic PVs
73
A1 & A2
138,067
% of Cars
80
A3
28,107
% of Cars
16
A4 & above
6,937
% of Cars
4
UVs
48,437
% of Domestic PVs
21
MPVs
14,673
% of Domestic PVs
6
Exports
51,396
% of Total PVs
18
Total PVs
287,617
Cars: domestic volume (units)
200,000
FY13
FY14
FY15
FY16
Domestic Car volumes
continue to grow
160,000
120,000
80,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
UVs & MPVs: domestic volume (units)
106,000
76,000
46,000
16,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
FY13
FY14
FY15
FY16
UVs and MPVs continue to
face pressure
January 2016
20

Dashboard
Passenger vehicles: export volume (units)
FY13
74,000
65,000
56,000
47,000
38,000
29,000
20,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
FY14
FY15
FY16
Exports flat YoY
Cars: domestic market share
100%
Maruti
TataMotor
Hyundai
GM
Honda
MSIL market share steady
75%
50%
25%
0%
UVs: domestic market share
100%
75%
M&M
TataMotor
Toyota
Maruti
GM
M&M gains market share in
UVs due to TUV-3OO launch
50%
25%
0%
Passenger vehicles: segment mix
100%
A1
A2
A3
A4 & above
MPV
UV
A2 dominates the
passenger vehicles segment
75%
50%
25%
0%
January 2016
21

Dashboard
Sector Gauge
Commercial vehicles
M&HCV registers robust growth, LCV goods continue to remain weak
Nov-14
47,576
88
16,141
34
14,476
90
1,665
10
31,435
66
29,109
61
2,326
5
6,750
12
54,326
YoY (%)
8.6
24.6
24.8
22.8
0.4
-0.3
8.2
5.4
8.2
Oct-15
58,535
88
22,173
38
19,775
89
2,398
11
36,362
62
33,197
57
3,165
5
8,168
12
66,703
MoM (%)
-11.7
-9.3
-8.6
-14.8
-13.2
-12.5
-20.5
-12.9
-11.9
FY16-YTD
422,723
87
181,608
43
154,259
85
27,349
15
241,115
57
209,583
50
31,532
7
64,594
13
487,317
FY15-YTD
392,625
88
138,253
35
116,509
84
21,744
16
254,372
65
225,528
57
28,844
7
51,809
12
444,434
Chg (%)
7.7
31.4
32.4
25.8
-5.2
-7.1
9.3
24.7
9.6
Source:
SIAM/MOSL
Commercial vehicles: Volume snapshot
Nov-15
Total Domestic CVs
51,659
% of Total CVs
88
Total M&HCV
20,110
% of Domestic CVs
39
Goods
18,066
% of M&HCVs
90
Passenger
2,044
% of M&HCVs
10
Total LCVs
31,549
% of Domestic CVs
61
Goods
29,032
% of LCVs
56
Passenger
2,517
% of LCVs
5
Exports
7,112
% of Total CVs
12
Total CVs
58,771
M&HCVs: Domestic volume - goods (units)
FY13
32,000
FY14
FY15
FY16
M&HCVs Goods demand to
be led by economic
recovery
24,000
16,000
8,000
0
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
M&HCVs: domestic volume - buses (units)
7,500
6,000
FY13
FY14
FY15
FY16
M&HCVs Passenger shows
initial signs of recovery
4,500
3,000
1,500
0
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
January 2016
22

Dashboard
LCVs: domestic volumes (units)
60,000
FY13
FY14
FY15
FY16
LCVs continue to
face pressure
50,000
40,000
30,000
20,000
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
LCVs: domestic market share (%)
100%
TataMotor
Piaggio
M&M
Others
Tata Motors lose market
share in LCV down cycle
75%
50%
25%
0%
Goods: segment-wise break-up (%)
100%
75%
50%
25%
0%
LCVs
<12T
<16T
<35T
January 2016
23

Dashboard
News and Events
Major developments in the auto sector
Renault to pitch Kwid against Maruti's Alto; plans to launch new
versions in February
French car maker Renault, which has seen strong response to its small car Kwid, is
set to take the battle further on to market leader Maruti Suzuki's turf by taking the
covers off the 1-litre and automated manual transmission (AMT) versions of the
model at the auto show in February.
For Detailed Article please click on below link:
http://economictimes.indiatimes.com/industry/auto/news/passenger-
vehicle/cars/renault-to-pitch-kwid-against-marutis-alto-plans-to-launch-new-
versions-in-february/articleshow/50347143.cms
Hyundai's India unit set to close 2015 with record numbers;
Creta sees bookings for 75,000 units
Hyundai Motor India, the subsidiary of South Korea's largest car company, is set to
exceed its target for 2015 with the fastest sales growth in five years led by strong
demand for its new vehicle models.
For Detailed Article please click on below link:
http://economictimes.indiatimes.com/industry/auto/news/industry/hyundais-
india-unit-set-to-close-2015-with-record-numbers-creta-sees-bookings-for-75000-
units/articleshow/50347122.cms
Spurt in enquiries for large diesel vehicles in used car market
after Supreme Court ban: Survey
The ban on registration of larger diesel vehicles with engine capacity of 2000 cc
and above in the national capital region has led to a spurt in enquiries for the
affected models in the pre-owned car market, a survey by online automobile
marketplace CarDekho shows
For Detailed Article please click on below link:
http://economictimes.indiatimes.com/industry/auto/news/industry/spurt-in-
enquiries-for-large-diesel-vehicles-in-used-car-market-after-supreme-court-ban-
survey/articleshow/50299047.cms
Mahindra & Mahindra unveils micro SUV KUV100; to take on
Grand i10 & Maruti Swift
Betting big on the hatchback crossover (or micro SUV) space, Mahindra & Mahindra
on Friday unveiled the official rendering of the KUV100. Bookings for KUV100 or the
January 2016
24

Dashboard
S101 (as it is codenamed) will open at all dealerships across India from December
19, and the car will go on sale from January 15, 2016.
For Detailed Article please click on below link:
http://economictimes.indiatimes.com/industry/auto/news/passenger-
vehicle/uvs/mahindra-mahindra-unveils-micro-suv-kuv100-to-take-on-grand-i10-
maruti-swift/articleshow/50230777.cms
January 2016
25

Dashboard
NOTES
January 2016
26

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COMPANIES
COMPANIES
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