India, May 28 -- India Ratings and Research (Ind-Ra) maintains a neutral outlook for the auto ancillary sector in FY27, supported by strong structural drivers such as rising vehicle content due to premiumisation, GST 2.0-led domestic OEM demand, increasing EV adoption, favourable global trade agreements, and growing order books as global OEMs continue diversifying sourcing to India.

On the growth front, the sector is expected to deliver 7%-9% year-on-year revenue growth in FY27, following an estimated 8%-10% growth in FY26 (FY25 of 9%-10%). Export demand is also expected to gradually improve, aided by better trade agreements and steady global recovery, providing additional upside to overall revenue momentum.

From a profitability perspec...