New Delhi, March 11 (TIWN) Overall revenue and operating profits of automobile dealers are set to scale back to the pre-Covid levels in FY22, Crisil Ratings said on Thursday.

Accordingly, a study of 191 sector based entities rated by the agency predicted a 20-22 per cent revenue growth and 50-100 basis points (bps) improvement in operating margin expected for next fiscal. 

“Revenues, which were significantly impacted in fiscals 2020 and 2021, will see a steep recovery due to improved demand for automobiles across segments. This, along with improved ancillary revenues, which is more profitable than vehicle sales, will support overall operating profitability for automobile dealers, and boost cash accruals,” said the report.  As per the report, over the past 12 months, the cost of ownership of passenger vehicles (PVs) and two-wheelers (2Ws) has risen 8-10 per cent following a 15-17 per cent surge in fuel prices, price hikes by original equipment manufacturers (OEMs) to cover Bharat Stage (BS)-VI costs, and costlier raw material.