Bajaj Auto has cautioned that India’s motorcycle industry could slow sharply in FY27, with growth moderating to around 7–9 per cent from over 20 per cent levels seen in recent quarters. The company is betting on premium motorcycles, exports and electric vehicles to sustain momentum.

For FY26, the company delivered a record performance, with standalone revenue from operations rising 17 per cent year-on-year to ₹58,732 crore, EBITDA increasing 19 per cent to ₹12,019 crore and profit after tax climbing 21 per cent to ₹9,825 crore.

Total volumes crossed 51 lakh units, the highest ever. Speaking after the company’s FY26 results on Wednesday, Executive Director Rakesh Sharma said industry growth, which had been running at over 20 per cent in recent quarters, could moderate to around 7–9 per cent amid inflationary pressures, geopolitical disruptions and weakening consumer sentiment.

“It’s a considerable slowdown,” Sharma said, pointing to rising fuel prices, metal inflation, supply-chain disruptions and uncertainty triggered by tensions in West Asia. He added that softer sentiment was already visible in April retail trends and could continue in the coming months.

Yet, even as the broader motorcycle market slows, Bajaj Auto believes the premium end of the industry continues to outperform.

Sharma repeatedly highlighted the 150cc-plus motorcycle category — home to the Pulsar franchise — as the company’s biggest growth driver. He said Bajaj had gained market share across regions in the second half of FY26 through multiple product upgrades and refreshes introduced since October, with the 150cc-plus segment growing faster than the industry in every major state.

“In every single state of the country, the 150-plus segment performance has been better than industry growth,” Sharma said, adding that more product interventions were planned through FY27.

The comments reinforce a broader shift underway in India’s two-wheeler market, where growth is increasingly being driven by premium motorcycles while demand in entry-level commuter motorcycles remains under pressure. That transition is also helping Bajaj protect margins despite rising commodity costs.

Sharma said the company expects input-cost inflation of around 3–5 per cent due to higher metal prices, although some of the pressure has been offset through price hikes taken from April and favourable currency movements. A weaker rupee nearing ₹95 against the dollar was partly offsetting raw-material inflation through stronger export realisations, he said.

Exports emerged as one of Bajaj Auto’s biggest growth engines during FY26, with overseas shipments crossing the 6 lakh unit mark for the second consecutive quarter. The export business is now operating at around 2 lakh units a month, with an ambition to push toward 2.2 lakh units.

Importantly, Sharma indicated that the export recovery is now becoming geographically diversified rather than dependent on a single market.

While Nigeria, historically Bajaj Auto’s largest export market, remains at roughly half of its FY22 peak levels, the company still reported strong export growth due to sharp expansion in Latin America and recovery across other emerging markets.

“Latin America has been fantastic, not just from a volume point of view, but also from revenue as well as margins,” Sharma said, noting that the region increasingly buys higher-end Pulsar motorcycles.

Commercial vehicles and alternate fuels also featured prominently in the company’s growth mix, with Sharma highlighting strong export traction in three-wheelers, rising CNG penetration and the launch of new electric three-wheeler models in key markets.

The company also signalled growing confidence in its electric vehicle business, with Sharma indicating that EVs now account for more than 20 per cent of Bajaj Auto’s domestic revenues, while management indicated improving EV profitability. That is significant because much of India’s electric two-wheeler industry continues to remain under profitability pressure amid subsidy cuts and aggressive discounting.

Sharma suggested the role of subsidies in driving EV adoption was diminishing, with rising fuel-price expectations now becoming a bigger trigger for consumers shifting toward electric mobility.

“The impact of subsidy reduction is becoming less important in consumer decision-making,” he said, adding that consumers were increasingly viewing EVs as protection against fuel inflation.

Bajaj Auto also expects its KTM turnaround and integration exercise to take time. Sharma said restructuring efforts involving sourcing changes, manufacturing optimisation and cost rationalisation could take around 18 months, even as the group gradually expands India’s role within KTM’s manufacturing footprint.

The company is already ramping up production of KTM models in India, with volumes from its Indian plants rising sharply over the past year and expected to grow further as newer models and specifications are localised.

Taken together, the commentary and numbers suggest Bajaj Auto is becoming structurally less dependent on India’s traditional commuter-bike cycle and increasingly positioning itself around premium motorcycles, exports, EVs, commercial vehicles and global motorcycle partnerships, even as the broader two-wheeler industry enters a slower growth phase.

Published on May 6, 2026