Indian auto component sector growth to moderate in FY25; ICRA

15 Jul 2024 CW Team

Investment: Capital expenditure: The industry is projected to invest Rs 200-250 billion in FY2025 for capacity expansion and technological advancements. This investment is likely to constitute 8-10% of operating income over the medium term. Government support: The Production Linked Incentive (PLI) scheme will support the production of advanced technology and electric vehicle (EV) components. Vulnerabilities: The industry remains susceptible to fluctuations in commodity prices and foreign exchange rates, which could impact margins. Domestic OEM demand: Constitutes over 50% of sales for the Indian auto component industry. Growth in this segment is expected to moderate in FY2025. Replacement demand: Expected to remain stable at 5-7% after a period of healthy growth. Export market: Could be impacted by sluggish end-user markets in Europe and the US due to weak global economic conditions and geopolitical tensions.

Opportunities: Supply chain diversification: Ancillary companies can benefit from supplying components to new platforms as global OEMs diversify their vendor base and increase outsourcing. Replacement market: Ageing vehicle population and rising used car sales in overseas markets present opportunities for Indian exporters. Future drivers: Increasing adoption of electric vehicles, vehicle premiumisation, focus on localisation, and evolving regulations are expected to support stable growth for auto component suppliers in the long run.

This forecast by ICRA is based on a sample of 46 auto ancillary companies with combined annual revenues exceeding Rs 3,000 billion in FY2024. Despite the projected moderation in growth, the industry's investment in capacity expansion and technological advancements indicates a focus on sustaining long-term growth and resilience.

(Source: BS)

The Indian auto component industry is expected to see a moderation in revenue growth to 5-7% for the fiscal year 2025, following a robust 14% growth in FY2024. This is attributed to slower growth in the domestic original equipment manufacturer (OEM) segment and subdued export demand, according to a recent report by ICRA. Revenue growth: Expected to moderate to 5-7% in FY2025 from 14% in FY2024. Operating margins: Anticipated to improve by around 50 basis points year-on-year due to better operating leverage, higher content per vehicle, and value addition. Investment: Capital expenditure: The industry is projected to invest Rs 200-250 billion in FY2025 for capacity expansion and technological advancements. This investment is likely to constitute 8-10% of operating income over the medium term. Government support: The Production Linked Incentive (PLI) scheme will support the production of advanced technology and electric vehicle (EV) components. Vulnerabilities: The industry remains susceptible to fluctuations in commodity prices and foreign exchange rates, which could impact margins. Domestic OEM demand: Constitutes over 50% of sales for the Indian auto component industry. Growth in this segment is expected to moderate in FY2025. Replacement demand: Expected to remain stable at 5-7% after a period of healthy growth. Export market: Could be impacted by sluggish end-user markets in Europe and the US due to weak global economic conditions and geopolitical tensions. Opportunities: Supply chain diversification: Ancillary companies can benefit from supplying components to new platforms as global OEMs diversify their vendor base and increase outsourcing. Replacement market: Ageing vehicle population and rising used car sales in overseas markets present opportunities for Indian exporters. Future drivers: Increasing adoption of electric vehicles, vehicle premiumisation, focus on localisation, and evolving regulations are expected to support stable growth for auto component suppliers in the long run. This forecast by ICRA is based on a sample of 46 auto ancillary companies with combined annual revenues exceeding Rs 3,000 billion in FY2024. Despite the projected moderation in growth, the industry's investment in capacity expansion and technological advancements indicates a focus on sustaining long-term growth and resilience. (Source: BS)

Building Material

11 Dec 2025

Suraj Estate Wins Euromoney Award for India’s Best Residential Developer

"Suraj Estate Developers Limited has received the Euromoney Real Estate Award 2025 for ‘India’s Best Residential Developer’, positioning the company among globally benchmarked leaders in the sector. The recognition reflects its four-decade legacy in delivering high-quality residential and redevelopment-led projects across South Central Mumbai. The Euromoney Real Estate Awards, presented by the London-based Euromoney magazine, are widely regarded as one of the most credible global assessments of performance in real estate, banking and finance. Winners are selected through surveys of inte..

Building Material

11 Dec 2025

Lloyds Metals, Tata Steel Sign MoU to Explore Strategic Collaboration

"Lloyds Metals and Energy Limited has signed a non-binding Memorandum of Understanding with Tata Steel Limited to evaluate potential areas of strategic cooperation across mining, logistics, pelletisation and steelmaking. The MoU was signed by B Prabhakaran, Managing Director of Lloyds Metals, and Mr T V Narendran, CEO and Managing Director of Tata Steel. The partnership framework aims to leverage the natural operational synergies between both companies and assess opportunities in greenfield steel projects, iron ore mining, slurry pipeline infrastructure, pellet manufacturing in iron ore–ric..

Building Material

11 Dec 2025

IndiaAI, Gujarat Govt Host Regional Conclave Ahead of 2026 AI Summit

The IndiaAI Mission under the Ministry of Electronics and Information Technology, along with the Government of Gujarat and IIT Gandhinagar, convened a Regional Pre-Summit Event at Mahatma Mandir, Gandhinagar. The initiative is part of the build-up to the India–AI Impact Summit 2026, scheduled for 15–20 February 2026 at Bharat Mandapam, New Delhi. The conclave brought together senior policymakers, technology leaders, researchers and industry practitioners to examine how AI can accelerate economic, digital and social transformation across sectors. The programme focused on the overarching th..