Goldman Sachs and Brickwork Forecast Growth for India Auto Sector

Financial analysts project a period of steady expansion for India's automotive and auto-ancillaries sector, driven by a structural shift toward a technology-led manufacturing ecosystem. Goldman Sachs expects the precision machining and auto parts industry to achieve a 10 percent compound annual growth rate in revenue between FY26 and FY30, with revenues rising from USD 85.6 billion to USD 124.4 billion. This growth is supported by manufacturers diversifying into semiconductors, defense, aerospace, and data centers.

Brickwork Ratings forecasts an operating revenue growth of approximately 8 percent in FY27. The agency notes that the industry is entering a new investment cycle, with projects totaling Rs 703 billion scheduled for commissioning between FY27 and FY29, and a broader pipeline of projects valued at Rs 4.76 trillion. These investments are underpinned by Production Linked Incentive schemes, FAME-III incentives, and increasing electric vehicle penetration, which reached an estimated 8.6 percent in FY26.

Analysts attribute the stable outlook to India's competitive manufacturing costs and a protected domestic market. Both firms highlight electrification and the global shift in internal combustion engine manufacturing as primary drivers. Brickwork Ratings expects EBITDA margins to increase slightly to 14 percent through FY27, while Goldman Sachs projects EBITDA to grow at a 15 percent compound annual growth rate through FY30.