Nomura Bets Big on Indian Auto: Top Picks for Revenue Boom

AUTO

Overview

Nomura Securities highlights robust growth prospects for India's auto sector, projecting a 25% revenue surge for OEMs in FY26. The brokerage names Mahindra & Mahindra as a top pick alongside key ancillary players, despite anticipating commodity cost pressures. The report details strong demand drivers across passenger, commercial, and two-wheeler segments.

Nomura Flags India Auto Sector for Strong FY26 Growth

Nomura Securities is signaling a significant upswing for India's automotive industry, identifying Original Equipment Manufacturers (OEMs) and ancillary firms poised to benefit from a projected 25% cumulative revenue growth in fiscal year 2026. Passenger vehicle volumes have already seen a 22% year-on-year increase in the third quarter, with the commercial vehicle segment also exhibiting robust expansion driven by rising freight rates and fleet operator profitability.

Top Picks Across Segments

The brokerage house has placed Mahindra & Mahindra (M&M) as its leading selection among OEMs. Other manufacturers receiving a 'Buy' rating include Ashok Leyland, TVS Motor Company, and Hyundai Motor India. Nomura anticipates that Ashok Leyland and Tata Motors Commercial Vehicles will surpass market expectations in earnings. The trend of premiumisation continues to dominate, particularly in the passenger vehicle space, with a sustained rise expected in the SUV mix.

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