The recovery continues to remain overwhelming. More so, the story is now extending beyond rural demand. In consumption, going beyond food & beverages, greenshoots are now seen spreading even in two-wheeler space. While a clear picture will emerge from July sales data, quite a few emerging trends are boosting the urban sentiments.
Greenshoots that were visible in the rural economy have now begun to spread its wings. Its thanks to the positive reactions that potential Covid vaccines are generating.
The under-development vaccine of the University of Oxford appears safe and induces a strong immune response within the body. The potential vaccine, called ChAdOx1 nCoV-19 has generated T-cell responses in 43 of the participants. The immunity peaks after 14 days.
After tractors, even two-wheelers are seeing a sustained pick-up in retail sales now. Expecting demand to sustain at least till the festival season,
Hero MotoCorp and Bajaj Auto are planning to expand their two-wheeler production.
Both the OEMs are expecting to touch pre-Covid levels with Hero MotoCorp planning to manufacture 6,50,000-7,00,000 vehicles a month. Bajaj Auto is also planning to ramp up its production to 3,20,000-3,50,000 units per month.
Citing pick up in retail sales, HeroMoto dispatched 4,50,744 units to its dealerships in June, up from 1,12,682 units in May. Bajaj Auto dispatched 2,55,122 units, up from 1,12,798 units in May.
Many startups are also reflecting the mood change, indicating pick up in urban sentiments. Companies like Snapdeal, UpGrad, Zomato, Ixigo and Grofers have rolled back salary cuts and even announcing increments and bonuses.
Zomato CEO Deepinder Goyal announced in a blog that salary cuts have been rolled back; and Snapdeal announced increments for around 700 employees, effective from June 1.
This development is a sentiment booster for the entire start-up eco-system and urban sentiments in general. Given the slowdown in the economy, unemployment was troublesome, particularly in the urban centers.
The urban unemployment was at 9.78% in the week ended July 19 against the rural unemployment rate of 7.1%. Overall national unemployment was at 7.94% during the same period.
