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Omicron to impact auto component industry’s FY22 revenue development: ICRA – New Delhi News

Besides, delayed restoration in semi-conductors and muted two-wheeler demand may also impact the revenue development of the trade in FY22, it stated.

The rankings company’s development forecast for FY2022 has been revised downward by 200 bps to 15-17 per cent from the sooner estimates.

However, wholesome demand from home OEMs in addition to substitute market, and sturdy exports will usher in some stability thr the revenue stream.

“ICRA expects a 15-17 per cent revenue growth in FY2022 for the Indian auto component industry, driven by domestic OEM, replacement, export volumes and pass-through of commodity prices,” stated Vinutaa, Assistant Vice President and Sector Head, ICRA.

“The healthy volume growth would, however, come on a low base of FY2021. There could be a downward bias to our estimates in case of prolonged lockdowns or significant demand slowdown because of the Omicron wave.”

According to the company, most home OEMs’ sub segments are anticipated to register wholesome quantity development in FY2022, albeit on a low base of the final fiscal.

However, sure segments like 2Ws and buses shall be impacted by the Omicron wave.

“We expect delayed recovery in the 2W segment because of affordability and dampened sentiments. Also, demand for buses is expected to be impacted during the upcoming school season for the third year in a row,” the company stated.

“Supply-chain issues could prolong further as well. Easing of Covid 2.0 related lockdown restrictions and improvement in personal mobility, healthy freight movement and pent-up demand arising from deferment of purchases last year, supported replacement sales for auto components in Q2 and Q3 FY2022.”

Additionally, the company stated that whereas there could possibly be some impact on mobility due to the continuing covid wave, freight motion and deferment of recent automobile purchases will end in wholesome substitute demand in This autumn FY2022.

Disclaimer: This story is auto-aggregated by a pc program and has not been created or edited by FreshersLIVE.Publisher : IANS-Media

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