No quick return to normalcy, says Viji
Certain areas of the commercial vehicles (CV) segment are still under stress, said Harsha Viji, executive vice-chairman, Sundaram Finance Ltd.
“I don’t think it is going to be a quick fix for the next three to six months for everything to come back to normal,” he told The Hindu.
The second half of the current fiscal would be much better compared with the year-earlier period, provided the third wave did not throw a spanner, he added.
Mr. Viji cited examples of sectors in distress including tourism (taxis and buses), transport (route and staff buses), educational sector, and market load operators.
“In general, those market load operators, who are not on fixed contract, are also affected and freight prices are depressed,” he said.
Though diesel prices had gone up, freight rates had not been increased to compensate for it, he observed.“The load utilisation is low. I would not say that commercial vehicle recovery has just happened and the second half will be great. We are not at the position to say that,” Mr. Viji said.
“That being said, every month is looking better than the previous month in terms of sales growth and collections. We are seeing a month-by-month improvement,” Mr. Viji said. “So, second half will be much better. But these areas of stress will not be easy for them to go away. It will take time,” he added.
On a positive note, he said that the construction equipment related sector, which included backhoe loaders, excavators, pavers and tippers, was doing well. “There is lot of infrastructure spend and the government is spending even more on infrastructure. That part of the segment has been doing well and continues to do well,” he added.
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