Demand is expected to slowdown in the coming months, however.
During Sep-16, domestic sales of passenger vehicles rose 20% YoY and two wheelers grew 22% YoY, ahead of Diwali and Dussera in Oct-16.
MayBank KimEng’s channel checks suggest the demand for automobiles is 10% more than in the previous two festive seasons.
“We expect demand to normalize lower in Nov and Dec as dealers start cutting inventories,” it said in a report.
The Society of Indian Automobile Manufacturers (SIAM) confirmed the uptrend by revising up its sales growth forecast to 10-12% for FY17 from 6-8%.
“We will wait for two more months of retail sales data before deciding whether to revise up our growth forecasts,” said MayBank KimEng.
