The tax relief in the union budget FY26 and the repo rate cut by the Reserve Bank of India (RBI) are likely to boost demand for the Rs 10 lakh to Rs 25 lakh car segment, a top company official at Mahindra & Mahindra told reporters.
The RBI on February 7 cut the repo rate by 25 basis points at 6.25%. “Demand is going to be very robust for products Rs 10 to Rs 25 lakh in the country. And our strategy is to play in the Rs 7-25 lakh category,” says Rajesh Jejurikar, Executive Director- auto & farm division at Mahindra & Mahindra.
According to Dr Anish, Group CEO of Mahindra & Mahindra, tax relief will create demand stimulus for the middle class. “We believe the fundamentals for the Indian economy are very strong, and we’ve seen some blips in the short run, the relief, in terms of taxation for the middle class, puts more money in their hands, and that will create a demand stimulus, which is going to help and in turn, translate to greater capex from a private sector as well, which has also been an area that has been lacking in some way…. And similarly, the rate cut also will help in terms of creating a little bit more of a demand stimulus. So, both are positive moves from an economic standpoint,” says Shah.
Mahindra & Mahindra reported a 19% increase in year-on-year profit to Rs 2,964 crore, whereas the revenue from operations surged by 20% YoY to Rs 30,538 crore in the October to December quarter of FY25 on the back of strong SUV (sports utility vehicle) demand. The company continued to dominate the SUV market, with the SUV market share at 23%.
The company, which launched its flagship born-electric models — BE.6 and XEV.9e in December last year— will begin bookings of the EVs beginning February 14 this year. The company will initially roll out 5,000 units of BE.6 and XEV.9e.