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Sales figures for the month of January detailed by automobile manufacturers would lend cues to the counters in the coming week. Maruti Suzuki India Ltd yesterday reported a 1.1% fall in its January total vehicle sales to 114,205 units, which was better than expected and would see the stock reacting positively in the coming week. However, the upside would be "marginal" as the sales numbers had been factored in yesterday. Mahindra & Mahindra Ltd's total automotive sector sales rose 11% on year to 49,503 units in January, powered by a 33% increase in its domestic passenger vehicles sales at 26,555 units, which would result in a marginal positive movement in its counter early next week. Investors will also eye automakers' Oct-Dec earnings, with Mahindra & Mahindra Ltd slated to announce its results on Feb 8. Mahindra & Mahindra's net profit for Oct-Dec is seen up 30% on year at 8.63 bln rupees. However, said that overall the counter is likely to weaken next week as the company's Oct-Dec earnings may be below expectation. We expect a mixed Q3 (Oct-Dec) for auto manufacturers with sales/PAT growth of 10%/8% and flat margins YoY (+60bps QoQ). In January, the Society of Indian Automobile Manufacturers cut passenger cars sales growth forecast to 0-1% in 2012-13 (Apr-Mar) from 1-3% forecast earlier, and that of commercial vehicles to 0-2% from 3-5%. Sales of two-wheelers are seen growing 3-5% from 5-7% forecast earlier.
