Mahindra Sees Healthy Demand Despite Fuel Price Risks; No Production Hit from Gas Supply Issues

Mahindra & Mahindra expects demand in its core SUV business to remain resilient even if fuel prices rise, and has guided for mid to high teen growth for FY27, while saying recent gas supply constraints have not disrupted production so far.

Executive Director & CEO (Auto and Farm Sector) Rajesh Jejurikar said the company has factored in the possibility of higher fuel prices and inflation while building its near-term outlook.

“A lot of our products are not so sensitive to fuel price increase… customers are buying for the feel of ownership and the experience,” Jejurikar said, indicating that demand for Mahindra’s SUV portfolio is relatively insulated from fuel price swings.

He added that while fuel price increases could have a broader impact on the market, the company has already moderated its growth assumptions to account for potential pressure on demand.

Gas Constraints, But No Production Loss

On the supply side, Jejurikar said the company has navigated recent constraints in gas availability without any loss of output.

“We’ve not lost any volume of gas… March was very tight, but we didn’t lose any production,” he said, adding that April has also remained stable.

The comments come amid industry concerns over reduced gas allocation, which has put pressure on parts of the supplier ecosystem. Mahindra said it has been closely monitoring the situation, with teams working to manage supply chain risks and ensure continuity of operations.

Some Stress in Supplier Ecosystem

While production has remained unaffected, Jejurikar acknowledged that parts of the supply chain have seen stress, particularly due to manpower shortages at suppliers.

“The most significant issue has been manpower at suppliers… we expect that to improve as workers return,” he said. The company also flagged shortfalls at a few suppliers in April, though it expects these to be resolved in the coming months.

Demand Outlook

Mahindra said demand in its SUV portfolio remains stable, supported by product positioning and customer profile. It has guided for mid to high teen growth in SUVs, while indicating that broader market demand will need to be monitored in the event of sustained fuel price increases and inflationary pressures.