The Indian tyre industry is expected to record a 7–8 per cent growth in FY26, largely on the back of robust replacement demand, despite muted offtake from original equipment manufacturers (OEMs).
Analysts tracking the sector highlighted that capacity expansion, efficiency gains, and stronger R&D investment are fuelling the industry’s resilience.
JK Tyre & Industries Managing Director Anshuman Singhania said outbound shipments from the sector surpassed ₹25,000 crore in FY25.
He noted during an analyst call that the industry will achieve 7–8 per cent growth in FY26, supported by replacement demand, even as OEM volumes remain subdued.
Singhania added that the festive season, recent repo rate cuts, and favourable monsoon conditions are likely to improve consumer sentiment further.
He underlined that these factors, along with premiumisation trends, are strengthening prospects for domestic manufacturers.
Apollo Tyres Chief Financial Officer Gaurav Kumar said demand momentum is likely to strengthen in the second half of the fiscal year.
“We expect a rebound in infrastructure and mining segments post-monsoon. Raw material costs may ease slightly in Q2, though prevailing exchange rate volatility adds uncertainty,” Kumar said.
OEM Growth Remains Uneven: Analysts
Industry experts suggest that OEM demand for commercial and passenger vehicles may trail growth in the two-wheeler segments.
Icra Senior Vice President & Co-Group Head (Corporate Ratings) Srikumar Krishnamurthy said, “Replacement demand, the largest segment for tyres, will benefit from rural recovery, festive demand, and consumption gains from interest rate cuts, though urban demand remains soft.”
However, Krishnamurthy cautioned that exports could face challenges due to geopolitical tensions and potential tariff action in the United States.
Crisil Ratings also projected a 7–8 per cent revenue growth for the domestic tyre industry this fiscal, reaffirming replacement demand as the key growth driver.
The agency observed that replacement accounts for half of annual sales, while it expects OEM volumes to stay subdued. It further noted that rising premiumisation could provide a modest boost to realisations.
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