Expect two-wheelers, tractors to do well over four-wheelers: Tirthankar Patnaik, Religare Capital Markets

In a chat with ET Now, Tirthankar Patnaik of Religare Capital Markets, shares his views on the current outlook of the Auto sector. Excerpts:

ET Now: Do you think the demand has revived or the September numbers are a function of inventory push ahead of the festival season?

Tirthankar Patnaik: It is largely a good amount of the jump-up that we saw in two-wheelers and not really four-wheelers.

We have been pushing two-wheelers over four-wheelers in the auto space for quite a while right now. While two-wheeler numbers for TVS, HMCL, etc. all went up about 14 per cent to 15 per cent, CV numbers have been a negative 30 per cent for both Tata and Ashok Leyland.

Thus, in this space the only other segment that has done well is tractors. Hence, the macro overview is that one should push urban consumption down and look at the rural consumption.

We have been liking Hero Motors as well as Bajaj. Bajaj, in turn, also earns itself with addition benefits from the rupee depreciation, having 30-35 per cent of its revenues coming from exports. Therefore, from a four wheeler perspective, we remain negative on that space.