Royal Enfield Sees Steady Growth in Q4; Expects High Single-digit Industry Expansion in FY27

Eicher Motors expects domestic two-wheeler demand momentum to continue in the March quarter, though growth is likely to moderate to high single digits in FY27. The maker of Royal Enfield motorcycles said it aims to outperform the industry, supported by new products and a strong brand push.

“In Q4, we expect the growth momentum to continue. Enquiries are better. Conversions are better. Bookings are good,” B. Govindarajan, Managing Director at Eicher Motors and Chief Executive Officer of Royal Enfield said during an analyst call held to discuss the company’s December quarter performance.

He said the industry is likely to grow in high single digits next year, with premium motorcycles continuing to expand faster than the overall market. “We will continue to outgrow the market. That’s our ambition,” he said, citing a strong product pipeline and a brand-building campaign to mark Royal Enfield’s 125th anniversary.

Recovery in 650cc capacity bikes has also begun after a temporary slowdown following GST changes. Govindarajan said there was a period of pre-buying before the new tax rates came into effect, followed by a drop in volumes. However, demand has started to recover.

“The rate of recovery of 650cc started showing positive signs within about a month. The 450cc segment is also following,” he said. New launches such as the Classic 650 and Bullet 650 have lifted enquiries, while updates to the Himalayan platform have helped revive interest in mid-capacity models.

He said demand has not yet returned to pre-GST levels but is moving in that direction. “We are seeing traction in enquiries and conversions. That’s why we are positive,” he said.

Other Indian two-wheeler makers have also offered a similar outlook. Hero MotoCorp recently said it expects the domestic industry to grow in double digits in the March quarter and moderate to high single digits in FY27. The company said demand has remained strong since October, helped by GST-led price adjustments, improving rural sentiment and steady scooter demand.

Bajaj Auto has also indicated that domestic demand should remain healthy in the near term, supported by better consumer sentiment and a shift towards higher-value motorcycles. It expects industry growth of 12-15% in the immediate term, with the 125cc-plus segment growing faster than the overall market.

Together, the commentary points to a supportive near-term demand environment, though growth is expected to normalise next year as base effects and regulatory changes play out.

Q3 Performance

Eicher Motors reported strong sales growth in the December quarter. Royal Enfield sold 325,773 motorcycles in Q3 FY26, up 21% from 269,039 units a year earlier.

Domestic volumes rose 24% to 300,426 units. The company said retail demand remained healthy across all three months of the quarter, supporting strong year-to-date growth. Royal Enfield retained its dominant position in the mid-size motorcycle segment with an exit market share of 88.9%.

The festive period was particularly strong. The company sold more than 249,000 motorcycles during September and October, marking its best-ever festive performance. Management said strong marketing activations and a refreshed product range helped sustain demand.

International volumes declined slightly to 25,347 units from about 27,000 units a year earlier. However, retail demand remained strong in markets such as Brazil, Argentina and Thailand. The company launched updated models in several export markets and opened its first exclusive store in Lima, Peru, in December.

Royal Enfield’s portfolio spans mid-size motorcycles across the 350cc, 450cc and 650cc segments. Key models include the Classic, Bullet, Hunter, Meteor and Himalayan platforms. The company has been expanding its line-up with new variants and higher-capacity offerings to capture premium demand.

Govindarajan said more products are planned over the coming year. A flagship brand campaign to mark Royal Enfield’s 125th anniversary is also expected to boost visibility. “We have products lined up for the coming year and a strong brand campaign. With that, we are very optimistic that our growth will continue,” he said.