Automobiles & Auto Components share price target

The Indian automobile industry is poised for a healthy performance in Q3FY26, supported by sustained festive season momentum spilling over from October-November, favourable government policies including GST rationalisation on certain segments, improving rural incomes due to a normal monsoon, and gradual easing of interest rates.

India’s automobile industry saw a mixed but improving performance in Q2FY26, supported by steady demand in Passenger Vehicles (PV), a strong recovery in exports across segments, and stable momentum in Two-Wheelers (2W).

In November 2025, India's auto industry maintained solid growth momentum, capitalizing on strong festive demand in October and the long-term positive effects of GST 2.0 tax cuts. Sales of passenger vehicles, two-wheelers, commercial vehicles, and tractors all increased year on year, showing strong domestic demand, improving rural sentiment, and rising exports.

Maruti Suzuki’s Nov’25 performance reinforced the steady recovery in demand, with domestic volumes stabilizing and exports continuing to deliver strong momentum. The broader quarterly performance reflected resilient revenue growth supported by healthy exports and improved realizations, although margins remained under pressure due to elevated operating and input costs.

India's automotive OEMs posted healthy volume prints for November 2025. It was primarily driven by sustained demand momentum post festive season and amplified by GST 2.0 reforms, which lowered vehicle prices and boosted consumer sentiment. OEM wholesale sales volume for November 2025 came in healthy with PV & CV segment outperforming peers. CV space reported healthy volume prints for the month of November'25 with continued recovery visible across M&HCV & LCV segments. Maruti set the bar high, outperforming in the PV space while M&M continued with its...

We prefer TVS Motors, Hero MotoCorp and Bajaj Auto in 2Ws (Eicher seems fully valued at CMP); M&M (non-coverage) as a play in the PV/LCV/tractor segment, followed by Maruti in PVs. We also like Ashok Leyland in the CV space, followed by a close watch on Eicher (VECV) for any market share gains.

Top Conviction Ideas - Auto & Auto Ancillaries

We prefer TVS Motors, Hero Motocorp and Bajaj Auto in 2Ws (Eicher seems fully valued at CMP); M&M (non-coverage) as a play in the PV/LCV/tractor segment, followed by Maruti in PVs. We also like Ashok Leyland in the CV space, followed by a close watch on Eicher (VECV) for any market share gains.

India's automotive OEMs posted record-high volume prints for October 2025, driven by robust festive season demand and amplified by the GST 2.0 reforms which lowered vehicle prices and boosted consumer sentiment. OEM wholesale sales volume for October 2025 came in healthy with PV & tractor segment outperforming peers. CV space reported healthy volume prints for the month of October 2025 with recovery visible across M&HCV as well as LCV segment. M&M set the bar high, outperforming in both PV & Tractor segment, while Royal Enfield (Eicher motors) lead the growth...

Auto OEMs: TVS Motors, Eicher Motors, Hero MotoCorp. (M&M - Non-Coverage) Auto Ancillary: Sansera Engineering Ltd, Endurance Technology, Minda Corporation

India’s auto sales in September 2025 exhibited a strong upward trend, fueled by festive season momentum and the implementation of GST 2.0 reforms, which reduced tax burdens and stimulated consumer demand.

We prefer TVS Motors, Hero Motocorp, and Bajaj Auto in 2Ws (Eicher seems fully valued at CMP); M&M (non-coverage) as a play in the PV/LCV/tractor segment, followed by Maruti in PVs. We also like Ashok Leyland in the CV space, followed by a close watch on Eicher (VECV) for any market share gains.

Although Maruti’s Sep’25 sales reflected a modest overall recovery, but domestic challenges persisted. Growth in exports and compact segment offered some cushion, but continued weakness in SUVs and entry-level cars poses challenges, making the oncoming festive season and new launches critical for a volume and margin recovery.

As the festive season commenced along with anticipated GST rate cuts, OEM wholesale volume for September 2025 came in healthy. Notably, exports continue to stage a healthy growth on YoY basis for most of the OEMs. CV space reported healthy volume prints for the month of September 2025 with green shoots of recovery visible in the LCV segment. Tata motors set the bar high, outperforming in both PV & CV segment, while Royal Enfield (Eicher motors) lead the growth charge in the 2W domain. M&M continues to decisively dominate the tractor segment....

Government has announced GST 2.0 reforms which aims to rationalize the current multi-slab structure into a simpler framework, with two main rates of 5% and 18%, and a higher 40% slab for luxury and sin goods. For the auto sector, this overhaul...

India’s auto sales in August 2025 reflected a broadly mixed trend across segments. The industry’s domestic retail performance softened as consumers deferred purchases in anticipation of potential GST cuts

Total sales volumes remained largely flat at 1,80,683 units (-0.6% YoY, +0.1% MoM), as domestic weakness continued to weigh on overall growth, partly offset by resilient exports and steady LCV demand.

OEM wholesale sales volume for August 2025 came in healthy with 2W & tractor segments outperforming its peers. Notably, exports continue to stage a healthy growth on YoY basis for most of the OEMs. CV space reported healthy volume prints for the month of August 2025 with green shoots of recovery visible in the LCV segment. Maruti performed better than the peers in PV segment while Royal Enfield (Eicher motors) lead the growth charge in 2W domain. M&M continues to decisively dominate the...