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The commercial vehicle industry is likely to witness a growth (in volume) of 12-15% in the current fiscal year in the country, rating agency ICRA said in a report.

ICRA has predicted a positive outlook for the commercial vehicle industry in the country. As per the rating agency, the commercial vehicle segment is expected to continue its growth trajectory, given the improvement in the macroeconomic conditions and replacement demand.

"The growth trends in the commercial industry have been largely secular in nature, but more pronounced in the goods carrier sub-segment," said Kinjal Shah, Vice President & Co-Group Head, ICRA Ratings.

With the rebound in the economic activity, the medium and heavy commercial vehicles sub-segment has been spurred by demand from the steel, cement, and mining industries.

Until June this year, the industry has registered a growth of 112% on a yearly basis in wholesale sales.

Demand for tippers, Shah said, would continue to be supported by the pick-up in construction activities, while that for haulage trucks would be dependent on general activities.

On the light commercial vehicles, the report said the segment started recovering earlier than the medium and heavy commercial vehicles segment, supported by healthy demand from e-commerce as well as from agricultural and allied sectors.

"The upswing in the e-commerce sector since the pandemic, and the resultant change in purchasing habits resulted in increased last-mile transport requirements, thus spurring demand for smaller trucks," said Sruthi Thomas, Assistant Vice President & Sector Head at ICRA Ratings.

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