Mumbai, June 9
India’s two-wheeler industry is poised to surpass pre-Covid sales levels in the financial year 2025-26, with an expected volume growth of 8-9 per cent, according to a CareEdge Ratings report released on Monday.
Key tailwinds such as easing inflation, higher disposable income driven by a full income tax rebate for individuals earning up to Rs 12 lakh per annum and a more accommodative monetary policy -- highlighted by the cumulative 100 bps rate cut by the RBI since February 2025 with recent 50 bps rate cut announced in June 2025 -- are set to boost consumer sentiment and affordability. A favourable monsoon could further strengthen the growth prospects, setting the stage for the industry volumes to surpass pre-Covid levels.
CareEdge Ratings notes that during the past three years, ending FY25, the Indian two-wheeler industry maintained healthy volume growth of 8 per cent, 10 per cent, and 11 per cent in FY23, FY24, and FY25, respectively.
Volume growth in FY25 was supported by a substantial 21 per cent export recovery and a 9 per cent rise in domestic volumes. The export recovery was due to stabilisation in key markets affected by inflation, high interest rates, and currency issues in earlier years. Domestic volumes were supported by a substantial uptick in rural demand and sustained urban demand, the report states.