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Two-Wheeler Growth Set to Slow to 2 Percent in FY28 After GST Boost Fades
M
Moneycontrol•15-10-2026, 11:38
Two-Wheeler Growth Set to Slow to 2 Percent in FY28 After GST Boost Fades
- •Bernstein forecasts domestic two-wheeler volume growth to decelerate sharply to 2.1 percent in FY28 compared to a projected 9.7 percent for FY27.
- •The slowdown follows a fading boost from GST rate cuts that previously pulled forward replacement purchases and accelerated demand.
- •Recovery is anticipated in FY29 with an estimated 12.4 percent growth driven by expected wage revisions and rising household incomes.
- •Scooters are projected to cushion the slowdown better than motorcycles, with ongoing structural shifts toward premium and scooter segments.
- •Stock performance will likely depend on market-share gains and product mix rather than broad industry volume expansion.
Key Questions Answered
Bernstein expects domestic two-wheeler volumes to grow by only 2.1% in FY28, marking a sharp deceleration from the 9.7% growth forecast for the current financial year.
The growth is slowing because the dual boost from the GST rate cut, which brought in new buyers and pulled forward replacement purchases, is losing momentum and leaving a thinner pool of potential buyers.
A meaningful recovery and volume uplift are projected in FY29, when wage revisions are expected to lift household incomes and push industry growth back to 12.4%.
