The Indian auto sector recorded a remarkable performance in September, with the NSE Nifty Auto index rising 5.9%, marking its best September since 2019. This growth was driven by government GST rate cuts, festive season anticipation, and positive market sentiment.
The government’s decision to reduce GST rates on vehicles played a major role in boosting the sector. The GST on small cars was lowered from 28% to 18%, while the effective tax on large cars and SUVs was brought down to 40% by removing additional levies. These measures are expected to make vehicles more affordable for buyers and encourage higher sales in the coming months.
| Company | September Gain |
| Samvardhana Motherson International | 15.0% |
| Eicher Motors | 14.4% |
| Ashok Leyland | 12.7% |
| Bharat Forge | 8.1% |
| Company | September Decline |
| Sona BLW | -8.6% |
| Bosch | -4.6% |
| Exide Industries | -2.0% |
| Metric | Value |
| Nifty Auto P/E Ratio | 27.58 |
| Nifty 50 P/E Ratio | 21.86 |
| Projected CAGR (FY25–FY28) | 8% (Passenger vehicles & two-wheelers) |
Automakers are also offering festive discounts and strategically pricing vehicles to attract buyers and capitalise on rising demand.
Read more: RBI Interest Rate Changes Expected Tomorrow: Key Details Explained.
The strong performance of the NIFTY Auto index in September 2025 demonstrates how GST cuts, festive demand, and favourable policies are boosting the Indian auto sector. With supportive government measures and growing consumer interest, the sector is well-positioned for continued growth in the months ahead.
Investors with a Demat account can easily track and invest in these opportunities as the sector continues to grow in the coming months.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.
Published on: Sep 30, 2025, 12:31 PM IST
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