ICICI Direct sees 8–10% FY27 volume growth for two-wheelers and passenger vehicles
The brokerage expects Indian two-wheeler and passenger-vehicle volumes to grow 8–10% in FY27. August registrations rose 16% year on year to about 24 lakh, with strong reported gains across Bajaj Auto, TVS Motor, Tata Motors, Maruti Suzuki and Mahindra & Mahindra.
What happened
ICICI Direct forecasts 8-10% FY27 growth in Indian two-wheelers and passenger vehicles. August registrations rose 16%, while Bajaj, TVS, Tata Motors, Maruti
Key facts
- FY27 two-wheeler and passenger-vehicle volume growth forecast: 8-10%
- August 2026 Vahan registrations: about 24 lakh, up 16% YoY from 20.7 lakh
- Bajaj Auto volume growth: 30%; exports: 53%; domestic volumes: about 10%
- TVS Motor volumes: 5.9 lakh, up about 20.5%; exports up 29%
- Royal Enfield volumes: about 1.26 lakh, up 11%
- Tata Motors passenger-vehicle volumes: about 68,000, up 56%; EV volumes: 16,549, up 94%
- Maruti Suzuki volumes: about 2.16 lakh, up 21%
- Mahindra & Mahindra vehicle volumes: about 59,000, up 50%
- Hyundai volumes: about 66,000, up 9%
- Tata Motors commercial-vehicle dispatches: about 44,000, up 49%
- Ashok Leyland volumes: about 21,000, up 38%
- VECV volumes: about 8,400, up 18%
- Escorts Kubota tractor volumes: about 10,000, up 19%
- Mahindra & Mahindra tractor volumes: about 29,500, up 5%
- Expected monsoon: 90% of long-period average
Why this matters
Broad-based vehicle-volume growth could increase the strategic value of supplier, dealership, financing and after-sales partnerships tied to India’s expanding auto ecosystem.
What to watch
- Monthly Vahan registrations, especially rural-heavy two-wheeler markets and entry-level passenger vehicles.
- Festive-season bookings, dealer inventory days and discount levels across motorcycles, scooters, compact cars and SUVs.
- Monsoon distribution, rural wages, farm income, MSP-related policy actions and agricultural output.
- Auto-loan approval rates, financing penetration, interest rates and delinquencies among non-bank lenders.
- Fuel prices, insurance costs and input prices including steel, aluminium, rubber and battery materials.
- OEM production guidance, capacity additions, launch pipelines and market-share changes for Bajaj Auto, TVS Motor, Tata Motors, Maruti Suzuki and Mahindra & Mahindra.
- EV adoption rates, charging rollout and any changes to incentives, taxation or emission regulations.
- OEMs are likely to raise production plans, dealer inventories and component procurement ahead of festive and rural-demand periods.
- Automakers may accelerate launches in entry-level motorcycles, scooters, compact SUVs and EVs to capture incremental demand and defend share.
- Suppliers, tyre makers, auto financiers and dealerships could see higher volumes, though working-capital needs and inventory risk will also rise.
- OEMs with improved utilization may prioritize selective price increases, richer model mix and marketing spend rather than broad discounting.
- Capacity expansion and localization investments may increase if monthly retail registrations remain above trend for multiple quarters.