Domestic Commercial Vehicle (CV) volumes are expected to dip 4-7 per cent year-on-year next fiscal with high base effect kicking in, rating agency Icra said on Tuesday.
The volumes are expected to remain muted through the January-March quarter on account of a perceived pause in the infrastructural activities as the model code of conduct kicks in ahead of the general elections.
“Icra estimates the domestic CV industry volumes to register 2-5 per cent year-on-year growth in volumes in FY24. Subsequently, the industry’s sharp upcycle is expected to plateau in FY25, with a decline of 4-7 per cent in volumes,” the rating agency stated.
Icra Ratings Vice President & Co-Group Head Kinjal Shah said he expects the long-term demand for CVs to remain intact. The continued focus on infrastructure capex, emphasis on private participation in infrastructure, construction, defence and manufacturing activities would remain a long-term positive for the CV industry, he said.
“However, in the near term, Icra expects the volumes to plateau on a high base, amid the transient moderation in economic activity in some sectors with the onset of the general elections,” he added.