New Delhi, Oct. 13 -- India's automobile sector could see a shift in earnings leadership between FY26 and FY28 as rising raw material costs and slowing demand growth put pressure on profitability, according to a report by Systematix Institutional Equities.

It noted that FY27 could be a year of normalisation rather than a reversal, as the boost in vehicle sales from GST-related measures begins to moderate, while long-term demand drivers continue to evolve.

"We view FY27 as a year of normalization rather than reversal, as the GST-led volume boost moderates, while structural demand drivers continue to evolve," it said.

The report said the sector is moving from a post-pandemic recovery in profit margins towards a phase where sustainable ea...