Chennai: TVS Motor Company, which reported strong growth in revenue and profit for the June quarter, remains optimistic about the outlook for Q2 and FY27, forecasting double-digit growth for the domestic two-wheeler industry despite geopolitical tensions, inflationary pressures on commodities, and the possible impact of an El Niño weather pattern in the third quarter.The leading two and three-wheeler maker expects demand for ICE motorcycles and scooters to remain strong even as electric two-wheeler adoption gathers pace.“The overall growth in Q1 was very strong. We expect industry growth to be slightly better in Q2. The EV segment recorded around 67% growth in the first quarter, and I expect this momentum to continue in Q2. Overall, there are several structural demand drivers, including replacement demand, improved affordability, and continued EV adoption, all of which will support industry growth,” K N Radhakrishnan, Director & CEO, TVS Motor Company, said during the company’s Q1 FY27 earnings call.During Q1, the West Asia conflict led to volatility in commodity prices, particularly steel and aluminium. There were sharp increases in material costs, resulting in input cost pressures. There were also intermittent supply chain disruptions that affected material availability, especially during April.“We recovered well in May, June was much better, and we expect to maintain this momentum through July, August and September. Most importantly, we have been able to mitigate these cost increases through top-line growth as well as selective price adjustments taken during Q1,” he added.The company implemented around 1.5% price increases in Q1 and has taken a further 0.5% price increase in Q2. There could be another 0.5% increase in this quarter because of quarterly price revisions, he stated.Radhakrishnan said the company is going ahead with its ₹3,500 crore investment plan for capacity expansion and product development this year. Total two-wheeler production capacity is expected to increase to 8.3 million units by the end of this fiscal from 6.8 million units currently. Three-wheeler capacity will rise from 0.25 million units to 0.42 million units.The company reported a 38% increase in Q1 standalone revenue to Rs 13,896 crore, compared with Rs 10,081 crore in the corresponding quarter last year, while profit after tax (PAT) rose 51% to Rs 1,174 crore from Rs 776 crore. Q1 FY27 net profit included a fair value gain on investments of Rs 150 crore, compared with a gain of Rs 28 crore in the year-ago period.TVS Motor also reported its highest-ever international sales of 4.68 lakh units in Q1, up 33% year-on-year, driven by sustained demand across key overseas markets and the continued strengthening of its distribution network. Exports account for more than a fourth of the company’s total revenue.“In fact, demand is even stronger than our current production capacity, and we are expanding capacity to meet this demand,” said Radhakrishnan.Ends
