TVS Motor Company Faces Sluggish Growth Amid Middle East Conflict
TVS sees sluggish sales growth as the Middle East conflict impacts
Hindustan Times
Image: Hindustan Times
TVS Motor Company, India's third-largest two-wheeler manufacturer, anticipates sluggish growth in FY27 due to rising shipping costs and commodity prices linked to the Middle East conflict. The company plans to raise prices on its motorcycles and scooters to counteract these costs, despite reporting a 24% sales growth in FY2026.
- 01TVS expects single-digit growth in FY27 due to external economic pressures.
- 02Rising shipping costs and commodity prices are attributed to the Middle East conflict.
- 03The company plans to increase prices on two-wheelers to offset input costs.
- 04TVS reported a 27% YoY increase in two-wheeler sales in the last quarter of FY26.
- 05Strong retail demand persists despite supply-side constraints.
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TVS Motor Company, a leading two-wheeler manufacturer in India, is projecting a sluggish growth rate for the fiscal year 2027, primarily due to escalating shipping costs and commodity prices resulting from the ongoing conflict in the Middle East. CEO K N Radhakrishnan indicated that the company anticipates single-digit growth, a stark contrast to the 24% growth in sales volumes achieved in FY2026. To mitigate rising input costs, TVS plans to implement another price hike on its motorcycles and scooters, building on previous increases earlier this year. Despite these challenges, the company reported a 27% year-on-year increase in two-wheeler sales in the last quarter of FY26, driven by robust domestic demand and a 23% surge in exports. The recent reduction in the Goods and Services Tax (GST) rate for two-wheelers with engine capacities up to 350 cc has further bolstered sales, and TVS aims to maintain this momentum in the coming quarters through a focus on premium products, export expansion, and cost controls.
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The anticipated price hikes may affect consumers looking to purchase two-wheelers, while the company's growth challenges could impact employment and investment in the local economy.
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