Auto industry TIV to drop from September

KUALA LUMPUR: CGS-CIMB Research expects the total industry volume (TIV) for the automotive sector to drop post SST-implementation this month due to an increase in average selling prices compared to the tax holiday period. 

“Based on our channel checks, Perodua and Honda recorded an average 3% increase in selling prices, while Toyota recorded an average 6% increase compared to the tax holiday period. 

“Meanwhile, Proton is absorbing the SST for vehicles registered in Sep in order to maintain sales momentum, while Bermaz is also reportedly absorbing the SST for vehicles booked prior to September,” it said in a note.

The research house maintained its Neutral rating on auto sector.

It expects the sector to deliver higher earnings in Q3’18 driven by stronger TIV due to the tax holiday, new model launches and favourable forex. 

Nevertheless, it said the strong earnings potential for 2018 is already reflected in the sector’s valuation as it is currently trading at 15.9x CY19 price earnings ratio, which is above the last industry upcycle mean of 15x over 2010-2014.
Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 1
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights


Next In Business News

HeiTech Padu wins RM36.2mil MySikap contract
Soaring gas prices ripple through heavy industry, supply chains
Glomac profit tumbles in May-July quarter due to lockdown�
High flying Opcom makes RM2.6mil net profit in Q1
KLCI steps back 1.42 points as telcos weigh
Maybank extends over RM77bil in repayment assistance to customers as at Aug 31
CIMB targets RM30bil in sustainable finance by 2024
Indonesian shares lead Asia recovery on Evergrande assurance
Oil prices rise over US$1 after report of big draw in U.S. crude stocks
Ecomate offers 49m new shares under IPO

Stories You'll Enjoy