Analysts see auto demand rebound in H2 FY26 on GST relief and rate cuts

India’s automotive sector is expected to shift into higher gear in the second half of FY26, as a combination of policy support, rural revival and new launches align to lift demand across segments.

 

Brokerages see repo and CRR rate cuts, along with a likely GST rate reduction as key triggers, particularly for two-wheelers and small passenger vehicles (PVs).

 

Two-wheelers are expected to benefit the most from the demand upswing. Tax relief in the recent budget, improving rural sentiments and a pipeline of premium electric two-wheelers are expected to accelerate sales, B&K Securities said.

 

Royal Enfield and TVS Motor have already