ICRA projects 4-6% growth in PV sales in India in FY27
Ratings agency ICRA in its latest report has said that passenger vehicle (PV) sales in India are projected to grow 4-6 per cent in the current fiscal year (FY27), supported by steady consumer demand, improved affordability following GST rate reductions, and continued strength in the utility vehicle segment.
According to the report, passenger vehicle wholesale volumes registered a robust 27 per cent year-on-year increase in FY26, reaching 4.4 lakh units, while retail sales rose 33 per cent, driven by strong customer demand, new model launches, and an extended wedding season during the summer months. However, it cautioned that higher fuel and commodity prices, along with the possibility of a weak monsoon, could pose challenges to the sector. It said utility vehicles remained the key growth driver, accounting for nearly 68 per cent of total passenger vehicle sales in FY26. It noted that a recovery in demand was also visible across mini and compact car categories following the GST rate cuts introduced in September last year.
On the export front, the report said passenger vehicle shipments remained healthy, growing 13 per cent year-on-year in May 2026, reflecting an increasing supply push by Indian automakers in global markets. Meanwhile, it said the adoption of electric vehicles (EV) gained further momentum, with EV penetration in the passenger vehicle segment increasing to around 6 per cent in the early months of FY27.
