New Delhi, Oct. 8 -- Automobile OEMs are expected to deliver strong earnings growth in the second quarter of FY26, supported by healthy growth in revenue and operating profit, along with margin expansion. The improvement is attributed to the recent GST rate cut, subdued commodity inflation, and a favourable regulatory environment.

The GST Council's decision to reduce tax rates across most automobile segments has provided a much-needed boost to the sector. These timely rate cuts, combined with other supportive factors such as a normal monsoon improving rural sentiment, a ~100 bps reduction in interest rates in CY25, and income tax benefits, are expected to revive auto demand during the ongoing festive season.

According to Axis Securities...