The brokerage expects a strong recovery in the Indian medium and heavy commercial vehicle segment, with volumes seen growing 8% to 10% YoY in FY26 and FY27. The upcycle is likely to be driven by higher freight rates, better fleet operator profitability, an ageing vehicle base and possible pre buying ahead of regulatory changes and price hikes.
With a 46% market share in the domestic MHCV segment in FY25, Tata Motors is seen as a key beneficiary of the demand revival. The brokerage also flagged long term upside from the EUR 3.8 billion acquisition of Iveco's truck business, which is currently in a downcycle but is expected to recover from FY27. EBITDA margins for the commercial vehicle business are seen expanding to 12%-13% over FY26-FY28, with further upside to earnings estimates.
Tata Motors is India’s largest and a globally recognised manufacturer of utility vehicles, pick ups, trucks and buses, with operations in India and South Korea and a presence across Africa, the Middle East, Latin America, Southeast Asia and SAARC countries. On 12 November 2025, shares of Tata Motors’ commercial vehicle business, listed as Tata Motors, made a strong debut following its demerger from the passenger vehicle division.
Tata Motors reported consolidated net loss of Rs 867 crore in Q2 FY26 compared with net profit of Rs 498 crore in Q2 FY25. The earnings were hit by mark to market losses of around Rs 2,000 crore on recently listed investments in Tata Capital. Revenue from operations rose 5.99% YoY to Rs 18,585 crore during the quarter.