Updated 27 September 2025 at 10:05 IST
Festive Cheer Lifts Auto Demand as GST 2.0 Spurs 20-25% Growth: What It Means for Buyers
Indian car and two-wheeler buyers have a reason to cheer this festive season. GST 2.0-driven price cuts are fuelling 20-25% YoY demand growth, with dealers reporting strong Navratri sales. Experts see first-time buyers and even upgrades benefiting, but caution that demand may normalize after the festive rush.
- Republic Business
- 2 min read
Indian consumers are flocking to showrooms this festive season, with the latest GST 2.0 price cuts and OEM discounts driving demand higher. According to Emkay Research, dealers across regions are expecting 20-25% year-on-year growth between September and November 2025, citing strong sales during the opening days of Navratri.
“Volumes have picked up sharply in the first few days of the festive season, and we anticipate further demand build-up in October,” dealers told Emkay in its latest weekly strategy report.
Entry-Level Buyers and Upgrades Benefit
The impact is most visible in the price-sensitive entry-level segment, attracting many first-time car and two-wheeler buyers. Interestingly, some buyers are using this price advantage to upgrade to premium variants, showing a shift in consumer preferences.
Dealers noted that EV demand remains steady despite the relative price gap widening after GST cuts — a sign that early adopters of EVs remain committed to cleaner mobility.
Comfortable Inventory, But Growth May Normalise Post-Festivities
Dealer inventory levels are “comfortable,” Emkay said, with the industry well-stocked for the festive rush through Navratri, Dhanteras, and the upcoming wedding season. However, some market participants expect demand to normalize after November, making this a critical buying window for consumers to capitalize on discounts and lower prices.
Stocks to Watch: Auto Sector in Spotlight
For investors, the demand revival is a bullish signal. Emkay’s model portfolio is overweight on discretionary stocks, including key auto names:
Maruti Suzuki India – poised to benefit from surging passenger vehicle demand.
TVS Motor – well-positioned for two-wheeler sales growth.
Dixon Technologies – a key beneficiary of manufacturing-led momentum.
Shriram Pistons & Rings – likely to ride the aftermarket and OEM demand cycle.
What It Means for Consumers & Investors
For consumers, the festive season may be the best time in years to buy or upgrade a vehicle thanks to lower prices and dealer incentives. For investors, the demand uptick suggests auto stocks could stay in focus through Q3 FY26, making this a sector to watch closely.
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Published By : Gunjan Rajput
Published On: 27 September 2025 at 10:05 IST