India’s auto sector is poised for a strong turnaround in September 2025, led by festive sales momentum, GST cuts and supportive rural sentiment, according to Nuvama Institutional Equities. The brokerage expects wholesale volumes to rise across tractors, two-wheelers, passenger vehicles and commercial vehicles, with festive demand kicking in from September 22.
Channel checks suggest customer sentiment has improved sharply post-GST rate reductions. Adequate financing, inventory build-up and expectations of policy support — including Pay Commission payouts and tax reforms — are also lifting demand visibility.
Segment Outlook
Tractors: Domestic volumes are expected to grow around 10% YoY in September. Nuvama forecasts Mahindra & Mahindra’s (M&M) farm division to post 11% growth at 49,300 units, while Escorts (including Kubota) is seen up 10% to 13,600 units.
Two-Wheelers: Domestic volumes are projected to rise 8% YoY, supported by GST relief and improved entry-level demand. Eicher Motors – Royal Enfield sales is set to grow 54% YoY to 1.34 lakh units, TVS Motor Company by 10% to 5.3 lakh units, Bajaj Auto by 6% to 5 lakh units and Hero MotoCorp by 5% to 6.7 lakh units in September. Nuvama expects Royal Enfield and TVS Motor Company to lead.
Passenger Vehicles: The segment is seen growing 7% YoY. Tata Motors PV volumes are estimated to rise 13% to 46,800 units, M&M Auto 10% to 97,000 units, Maruti Suzuki India 8% to 2 lakh units and Hyundai Motor India 3% to 66,000 units.
Commercial Vehicles: A low base and infra activity are expected to lift CV growth to about 6% YoY. Tata Motors CV could clock 32,300 units (+8%), Eicher Motors-VECV 8,200 units (+8%) and Ashok Leyland 18,500 units (+7%).
Stock Picks
Nuvama maintains a positive stance on the auto sector and has named Maruti Suzuki, TVS Motor Company, Mahindra & Mahindra (M&M) and Hero MotoCorp as its top picks among OEMs.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
