ICRA expects the domestic CV industry volumes to register a 3-5% growth on a YoY basis in FY2026, following a couple of years of flattish volumes. The industry volumes remained flattish YoY in Q1 FY2026; however, an improving economic environment, coupled with improved pace of construction and infrastructure activities, proposed GST rate cuts, replacement demand due to ageing fleets, and Government mandates are the key driving factors behind the projected volume growth in the subsequent quarters.

• ICRA forecasts the Indian commercial vehicle (CV) industry wholesale volumes to see a modest YoY growth of 3-5% in FY2026, following a marginal 1% YoY decline in FY2025. The domestic wholesale CV volumes reported a marginal 0.6% YoY decline in Q1 FY2026, with early arrival of monsoons having some bearing on demand in the quarter. A steady recovery in volumes is anticipated in the subsequent quarters, aided by uptick in demand from rural and semi-urban regions

• The domestic medium and heavy commercial vehicle (M&HCV) (trucks) wholesale volumes reported a modest 4% YoY decline in Q1 FY2026 and are expected to grow by 0-3% YoY in FY2026 after posting a 4% YoY decline in FY2025. Early arrival of monsoons had some bearing on demand in Q1 FY2026. The segment is likely to report a modest YoY growth of 0-3% in FY2026, aided by an improved macroeconomic environment, increased demand from the construction and mining sectors, and consequently higher freight availability