New Delhi, February 22 The two-wheeler industry has the potential to grow at an 8-9 per cent CAGR in the long term, drawing from the momentum of the GST rate cut, government spending on infrastructure, and the overall growth of the economy, according to TVS Motor Company CEO KN Radhakrishnan.
The first half of the next year is also expected to be "very good" in terms of sales growth, as the benefits of the GST rate cut will continue to accrue to the industry, he told analysts.
"Overall, I am confident that an 8 per cent to 9 per cent CAGR can be considered on a long-term basis," Radhakrishnan said when asked about the growth prospects of the two-wheeler industry for the next fiscal, based on strong performance in Q3.
He also noted that the benefit of the GST rate cut, which was implemented on September 22 last year, will be seen in Q4.
"The first half of the next fiscal year is also going to be very good because the benefits will accrue to the industry," he added.
While not sharing an exact forecast for the next fiscal, Radhakrishnan said, "I think you will see robust growth in the two-wheeler segment even in FY27."
Sharing the reasons for the bullish outlook, he said that with improved road connectivity in rural, urban, and semi-urban areas, while the public transport system remains a challenge, personal mobility, especially two-wheelers, stands to gain.
Moreover, he said, "The 'self-employed' segment is a significant part of the Indian population. Given this, two-wheelers are the best segment because customers can afford them, and they can definitely use them for mobility, as well as 50 per cent of the self-employed group."
Overall, Radhakrishnan said that the GDP is likely to grow.
In the ongoing fiscal year, he said, the benefit of the GST rate cut is playing out not only in two-wheelers but across sectors where consumers have benefited.
Expressing confidence that in Q4, the growth of the two-wheeler industry could be "anything upwards of 15 per cent", which is "one of the best growth rates that we have seen".
For FY26 as a whole, he said, "...the first half has not been so great. It was only a 2 per cent growth. So, the year as a whole, you will see somewhere around 9 per cent growth..."
