ICRA Projects 6-9% Growth for Two-Wheeler Segment, Recent Sales Show Mixed Trends
ICRA projects 6-9% year-on-year volume growth for the domestic two-wheeler segment in the upcoming fiscal year, driven by steady replacement demand, urban consumption recovery, and expected healthy rural incomes. Recent performance shows mixed results with 9% increase in wholesale volumes but 6.5% decline in retail volumes. Exports grew by 32% year-on-year. The electric two-wheeler segment maintains 6-7% market penetration. ICRA anticipates improved retail demand in the upcoming festive season.
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The domestic two-wheeler market is poised for growth in the coming fiscal year, according to a recent forecast by ICRA, a leading credit rating agency. The projection comes amid a mix of positive indicators and current market challenges in the sector.
Growth Forecast
ICRA anticipates a 6-9% year-on-year volume growth for the domestic two-wheeler segment in the upcoming fiscal year. This optimistic outlook is underpinned by several factors:
- Steady replacement demand
- Recovery in urban consumption
- Healthy rural incomes expected from normal monsoon conditions
- Potential reductions in GST rates
Recent Performance
The two-wheeler market showed mixed results in the most recent month:
- Wholesale Volumes: Increased by 9% year-on-year to 15.00 lakh units
- Manufacturers maintained strong dispatches in preparation for the festive season
- Retail Volumes: Declined by 6.5% year-on-year
- Attributed to weak urban demand and heavy rainfall impacting rural sales
- Exports: Demonstrated strong momentum with a 32% year-on-year growth
Electric Two-Wheeler Segment
The electric two-wheeler market continues to maintain a significant presence:
- Recent monthly sales reached 1,02,900 units
- Slight decline of 2% on a sequential basis
- Maintained a 6-7% penetration in the overall two-wheeler segment
Future Outlook
ICRA expresses optimism for the upcoming festive season, expecting a significant improvement in retail demand. This anticipated uptick, coupled with the projected growth for the next fiscal year, suggests a potentially robust period ahead for the two-wheeler industry.
The forecast highlights the resilience of the two-wheeler market, which continues to adapt to changing consumer preferences, economic conditions, and the gradual shift towards electrification. As the industry navigates through current challenges, the long-term outlook remains positive, supported by multiple growth drivers and the evolving landscape of urban and rural mobility needs.
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