New Delhi, April 21 (NationPress) India's two-wheeler sales have reached an unprecedented milestone in FY26, with domestic wholesale figures soaring to approximately 22 million units, according to a report released on Tuesday.

The analysis by ICRA indicated that wholesale volumes experienced a notable increase of around 20 percent in March 2026, while retail sales surged by 28.7 percent year-over-year. For the entire fiscal year, two-wheeler domestic volumes rose by about 11 percent.

ICRA projected a slowdown in two-wheeler wholesale volume growth, anticipating a moderation to 3–5 percent year-over-year in FY2027. This is attributed to a higher comparative base and a potentially weak monsoon forecast driven by the El Nino phenomenon, which may adversely affect rural demand.

Nevertheless, the report suggests that demand will continue to be bolstered by GST rationalization and heightened replacement demand.

In FY2026, domestic wholesale volumes saw a year-over-year increase of 10.2 percent, thanks to GST reforms that positively impacted growth in both the third and fourth quarters. In contrast to a modest rise of around 1 percent in the first half, industry volumes surged by 20.3 percent in the second half of FY26.

Retail sales experienced a remarkable growth of 28.7 percent year-over-year in March 2026 and approximately 13 percent for the entire fiscal year, as reported.

This growth was supported by GST reforms, better rural cash flows, and favorable macroeconomic policies, including repo-rate cuts and income tax relief, which collectively enhanced consumer demand.

A broader product range catering to both entry-level and aspirational segments further contributed to this growth.

Electric two-wheelers also saw a significant rise, with retail sales climbing steeply to 192,023 units in March 2026, marking a 47.4 percent year-over-year increase. Electric two-wheeler sales grew by 21.9 percent year-over-year in FY26.

The penetration rate of electric two-wheelers within the overall two-wheeler market reached 9.4 percent in March 2026 and stood at 3.3 percent for the full fiscal year.

Monthly export figures reported a growth of 17.5 percent year-over-year in March 2026, despite challenges in certain international markets. Overall, export volumes increased by 23.3 percent in FY26, driven by expanding product lines and improved global recognition of Indian two-wheeler brands.

However, the ongoing conflict in West Asia presents potential risks to supply chains and exports, prompting industry stakeholders to closely monitor the evolving geopolitical landscape, as indicated by the ratings agency.