Credit rating firm ICRA has released a report on Indian auto-component industry. According to the report, the industry is expected to grow at 9-11 per cent in FY24, driven by factors such as premiumisation of components, increase in outsourcing by global OEMs and higher aftermarket potential in global markets with ageing of vehicles and increased sale of used vehicles.

Here are the key trends in the auto-component industry.

Indian auto-component industry is dominated by demand from domestic OEMs

Passenger vehicles and two-wheelers collectively comprise 62 per cent of the total OEM business

Two-wheeler and three-wheeler segments to see a growth of around 10 per cent and 48 per cent, respectively in FY24

Capex as per cent of sales to increase from current levels of 5 per cent to 6.5-7.5 per cent in FY24 and FY25, respectively but will remain under the 9 per cent level touched in FY22

Highest EV penetration to be seen in two-wheeler and buse segments