TVS sees sluggish sales growth as the Middle East conflict impacts

India's third-largest two-wheeler company TVS is expecting to register a single-digit growth in FY27, owing to the Middle East crisis.

TVS Motor Company is expecting a sluggish growth pace in FY27. The homegrown two-wheeler giant has attributed the slow growth trajectory to the rising shipping costs and commodity prices due to the Middle East conflict. TVS has also stated that it would raise prices of its two-wheelers in order to offset the rising input costs. TVS has already increased the prices of its multiple two-wheelers earlier this year, citing growing input costs as a reason. Now, the motorcycles and scooters of the company are expected to see another price hike.

India's third-largest two-wheeler company TVS, is expecting to register a single-digit growth in FY27, owing to the Middle East crisis.

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The third largest two-wheeler manufacturer in India, TVS Motor Company, is expecting to register a single-digit growth in this financial year, owing to the ongoing crisis. The automaker expects its sales volumes to grow above the industry average in the single-digit percentage range in this financial. In a post-earnings call, the auto company's CEO, K N Radhakrishnan, said that its sales volumes grew 24% in FY2026. Considering that, a single-digit growth would be a significant dip in sales numbers.

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TVS is taking a multipronged approach to counter the impact of the ongoing crisis. The company is relying on a premium product mix, export expansion and cost controls to cushion the higher shipping expenses, as well as higher commodity prices stemming from the closure of the Strait of Hormuz due to the US-Iran conflict. This is a strategy similar to the ones taken by Bajaj Auto and Hero MotoCorp. TVS has further stated that near-term uncertainty stems largely from supply-side constraints rather than weak demand. The company also said that its retail demand is robust across markets.

In the last quarter of FY26, which ended in March 2026, TVS' two-wheeler sales rose 27% on a year-on-year (YoY) basis to about 1.35 million units. This was driven by the strong domestic sales and a 23% surge in export figures. The tax rate cuts announced during the festive season last year reduced the GST rate from 28% to 18% for the two-wheelers with engine capacity up to 350 cc, which helped boost sales for the company. This momentum is likely to sustain the demand over the next two to three quarters.