Two-wheeler exports see 20% uptick in H2 with demand recovery

With demand revival in the international markets, the two-wheeler exports from India are witnessing an uptick in the second half of the current fiscal year. Two-wheeler exports have risen by a fifth in the months July to November, aided by a low base and a recovery in demand across markets.

According to the Society of Indian Automobile Manufacturers (SIAM) two-wheeler exports rose to 17,63,496 units between July and November compared to 14,64,081 units sold in the same period year ago.

• Read also: 2-wheeler exports rise 23% in H1 of 2024 but recovery fragile

“With innovative designs, market-specific products, good distribution networks and robust after-sales service, Indian OEMs have been enhancing their presence across geographies like West Asia and Europe as well. Despite their efforts, weak demand trends across various geographies curtailed export volumes over the past two fiscals; a shortage in forex and inflationary concerns impacted demand materially. Aided by a low base and a recovery in demand across markets (barring Africa), the export volumes have reported a recovery over the past few months,” said Rohan Kanwar Gupta, Vice President & Sector Head – Corporate Ratings, ICRA Limited to businessline.

Indian Original Equipment Manufacturers (OEM) have increased their focus on expansion into new international markets and are shifting their dependence from existing geographies including Columbia, Nigeria, Philippines, Mexico, Sri Lanka, Bangladesh, Egypt and Nepal.

• Read also: Bajaj Auto two-wheeler sales down 7% y-o-y in November while export grows by 26%

“Steady revival in the overseas markets continues and the number of countries that remain in stress conditions is also slowly reducing. The Latam region is leading in world growth with 20 per cent year-on-year growth. Asia is now almost at par with the previous year, but Africa continues to decline across nearly all major markets, though the decline rates have reduced to about minus 9 per cent. In Nigeria, our benchmark motorcycle sales, as you know, used to be at around 50,000 per month. It dropped to 5,000 in April, but retail recovered to about 25,000 in September. The recovery over there is expected to be steady, in small steps,” said Rakesh Sharma, Executive Director of Bajaj Auto Limited during an earnings call.

According to Prabhudas Lilladher, the automotive industry is expected to grow at a moderate pace due to pent-up demand and a high base effect. Amongst segments, the two-wheeler segment volume is expected to grow by 10 to 12 per cent over FY24.

• Read also: India’s refined petroleum product exports rose in October aided by petrol and jet fuel 

“We are seeing good traction coming from markets like Colombia. Colombia, I must say, delivered their first quarter of a bottom-line turnaround. They are cash and EBITDA positive for the first time. And of course, then we see traction coming from Mexico and from some of the other countries as well. There are countries that need to fire more, and that is because of their geopolitical, economic situation, which are Bangladesh, Turkey, and Nigeria. But as it gets sorted out in terms of their economic scenario, that should also aid the growth of our global business. I think our focus there – disproportionate focus on growing the top 10 countries while nurturing the rest of the countries and making selective entries into some of the markets, is starting to play out well,” said Niranjan Gupta, Chief Executive Officer of Hero MotoCorp Limited, during the earnings call.