Auto and auto components

Business model

The auto sector has two layers:

OEMs (Original Equipment Manufacturers) - companies that assemble and sell vehicles (cars, two-wheelers, trucks, tractors). Revenue = units sold × average selling price. Mix matters: a premium SUV makes more profit than an entry-level hatch.

Auto components / ancillaries - companies that supply parts to OEMs (engines, gearboxes, electricals, body panels, seating). Revenue depends on their content per vehicle, OEM volumes, and after-market sales.

Both layers are cyclical - demand swings with macro, fuel prices, financing availability, and regulatory cycles (BS6, EV transition).

Key metrics

For OEMs:

• Unit volumes by category - monthly data available
• Average selling price (ASP) - direction of mix
• Realisation per vehicle - captures both volume and mix
• Domestic vs exports
• Capacity utilisation - operating leverage signal
• Marketing spend per vehicle - competition intensity