Chennai: TVS Motor Company has struck a cautiously optimistic note for FY27, despite mounting concerns about commodity inflation and logistics disruptions stemming from the West Asia crisis, following robust revenue and profit growth in FY26.
Industry Growth and Capex Plans
The two-and-three-wheeler maker projects high single-digit growth for the two-wheeler industry in FY27, after 11% growth in FY26. In preparation for demand in India and overseas, it has chalked out a capex budget of about Rs 3,500 crore in this fiscal, among its largest capex outlays in recent years. It expects strong demand trends across scooters, premium bikes, and EVs.
"Our focus on product development and new products will continue. This itself will account for around Rs 2,000 crore this year," said K N Radhakrishnan, director & CEO, during the company's earnings call. "In addition, we are adding another 1.5 million units of production capacity across both two-wheelers and three-wheelers, which will involve another Rs 1,000 crore-plus investment."
Capacity Expansion and R&D Investment
The company is also investing in boosting R&D and testing capabilities. The planned expansion will lift annual production capacity to about 8.3 million units, compared to sales of close to 6 million units in FY26. Radhakrishnan said the company could consider further capacity additions in FY28 and FY29.
EV Business Momentum
TVS Motor's EV business continued to gain momentum, with monthly sales rising from about 30,000–32,000 units to nearly 40,000 units. The company expects that figure to climb further to around 50,000 units a month. "That is the direction we are moving in on EVs," he said.
Overseas Sales and Challenges
On overseas sales, the company said it expected the strong momentum seen in Q4FY26 to continue into FY27, although shipping disruptions and longer transit times linked to geopolitical tensions in West Asia remained a concern. It is working closely with distributors to mitigate logistical challenges.
Radhakrishnan said commodity inflation could have an impact equivalent to about 3%–5% of revenue, of which the company had so far offset roughly 35% through price increases. "We are closely monitoring the situation in both domestic and international markets," he added.
Super-Premium Motorcycle Strategy
The company also signalled progress in its super-premium motorcycle strategy through Norton Motorcycles. Products are being readied at both its Hosur facility in Tamil Nadu and the Solihull plant in the UK. "FY27 is going to be a very important year, especially Q2 FY27, and the next phase of growth for both TVS and Norton," Radhakrishnan said.
Financial Performance
For FY26, TVS Motor reported a 30% increase in revenue to Rs 47,270 crore, compared with Rs 36,251 crore in FY25, while net profit rose to Rs 3,615 crore from Rs 2,634 crore. The board declared an interim dividend of Rs 12 per share, amounting to an aggregate payout of Rs 570 crore for FY26.
