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Festival season won’t be great for M&M from supply angle but it is a short term issue: Rajesh Jejurikar

ETMarkets.com

Hopefully with the government supporting investments and overall pumping money into the economy, demand should stay robust, says Rajesh Jejurikar, ED, M&M.

What is the good news for M&M now?
Well the good news is demand is very strong. We have all seen over the years that demand is harder to fix because that is fundamental to how your brands are doing and how your products are doing. So our products are doing very well. We have had the new launches — Thar which has 75,000 bookings in a year and XUV700 is garnering a lot of excitement. There are 250-300 people in the showroom every day since we started the test drive on the weekend. So there’s a lot of excitement around the new launches. Bolero new is also doing well.

Of course, from a supply point of view, the festival season is not going to be great but we think that is a short term issue. Things will open up as a lot of the extraneous factors which cause semiconductor problems hopefully will not recur. There was a fire in a plant in Japan for semiconductor supplier. There was Covid in Malaysia. Something had happened in the US a few months back. So in a tight demand situation, things got worse. Hopefully that will not recur and supplies will come back to a reasonable level.

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Can we say the worst is over?
If there are no more extraneous factors, hopefully the worst is over because a lot of the worsening of the situation was caused by things like Covid in Malaysia, fire in Japan and storms in the US. If that does not recur, then we should see supplies improve with time.

Generally we see big demand in the festive season and there is a lull in December. Then you open in January. Given the fact that the demand is strong, do you see this level of demand continuing for a longer time? The customers who want to buy will now have to shift from a festive season to a non-festive part?
We have seen demand being strong even before the festival season and so the demand hype is not a reflection of just the festival season. There has been fundamentally strong demand for cars. Covid has caused many people to rethink their mobility solution. People want cars in the house for personal mobility rather than relying only on shared mobility or public transport. So that certainly is a key driver and that is going to stay for a while. Hopefully with the government supporting investments and overall pumping money into the economy, demand should stay robust.

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Source: Festival season won’t be great for M&M from supply angle but it is a short term issue: Rajesh Jejurikar

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