In a note on the automobile sector on Friday, June 12, CLSA said demand trends remain skewed towards premium products across both passenger vehicles (PVs) and two-wheelers, even as broader consumption remains uneven.
Also read: MTAR Tech rebounds 10% on Bloom Energy project clarity; Here’s what the management saidAccording to CLSA, SUVs continue to lead growth in the passenger vehicle market, while premium motorcycles with engine capacities above 125cc are outperforming entry-level models.
It said that buyers have largely maintained their budgets following the GST rate cut, but are increasingly opting for better-equipped and feature-rich vehicles.
Entry-level segment sees muted demand
The brokerage noted that demand in the entry-level segment remains subdued for most automakers. However, Maruti Suzuki has seen some improvement in its mini and compact car categories, with volumes increasing by around 8,000-10,000 units per month on a cumulative basis.Shares of Maruti Suzuki were trading about 1.2% higher on Friday at ₹13,258; however, the stock has fallen 21% so far this year.
CLSA said automakers remain optimistic about demand despite challenging macroeconomic conditions. Original equipment manufacturers (OEMs) have highlighted a rising share of first-time buyers, along with replacement demand, as key drivers supporting expectations of strong single-digit industry growth.
Mahindra gains PV market share
Among passenger vehicle manufacturers, CLSA said Mahindra & Mahindra continues to gain market share on the back of successful new model launches.
The brokerage also highlighted a sharp improvement in volume run-rates at Tata Motors’ passenger vehicle business following recent product launches.
Who is leading the two-wheeler segment?
In the two-wheeler segment, CLSA said premium-focused players continue to strengthen their position. It noted that TVS Motor and Royal Enfield have been consistently gaining market share, while Bajaj Auto’s refreshed product portfolio could help the company recover from the weaker levels seen earlier in calendar year 2025.
Shares of Bajaj Auto are off opening highs, currently 1% lower at ₹10,016, while those of Mahindra & Mahindra have also given up gains and are trading at the flat line.
