India’s commercial vehicle (CV) sector is expected to perform moderately in the upcoming financial year, with low single-digit growth predicted for FY26, according to a recent report by Axis Securities. While demand in some areas, especially for buses, remains strong, the general market situation seems less strong than it has been.
"We expect a low single-digit growth in FY26E for CV companies, driven by a high demand in the bus segment," the report stated. Data from March 2025 supports this cautious prediction. Overall commercial vehicle sales decreased by 1% compared to the previous year (YoY) and dropped sharply by 28% compared to the previous month (MoM), indicating a slowdown from earlier months. The sales numbers showed different results for major manufacturers—some performed well, while others did not.
Volvo Eicher Commercial Vehicles (VECV) reported a significant 28% YoY growth, while Maruti Suzuki and Mahindra saw increases of 34% and 4%, respectively. On the other hand, major players Tata Motors and Ashok Leyland experienced declines of 10% and 7%. These different trends highlight the inconsistent rate of recovery across different types of vehicles and companies.
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Conclusion
While Axis Securities projects a modest single-digit growth for India's commercial vehicle sector in FY26, mainly due to strong demand for buses, the overall expectation points to a slower pace compared to previous times. The 1% YoY and substantial 28% MoM decrease in CV sales in March 2025, along with the varied performance of key manufacturers like VECV, Maruti Suzuki, and Mahindra doing better than Tata Motors and Ashok Leyland, emphasizes the complex and potentially difficult environment that CV companies will face in the coming financial year. This suggests that growth will be specific to certain vehicle categories and will depend on the ability of manufacturers to take advantage of those opportunities despite general market challenges.
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