Hyundai Motor India Ltd (HMIL) has seen its share price slide about 20 % from its all-time high reached in September 2025, as concerns grow over demand trends, margins and the impact of recent policy and business developments.
Despite expectations that recent tax reforms (GST 2.0) would boost sales, investors have been disappointed by limited benefits from the GST rate cut, which applies only to around 30 % of Hyundai’s net sales, according to brokerage InCred Equities. The company’s domestic volume growth has lagged behind peers like Maruti Suzuki and Tata Motors, adding to market pressure on the stock.
Near-Term Challenges
- Sequential sales slowdown: December 2025 sales fell on a quarter-on-quarter basis, with both domestic and export volumes easing.
- Margin pressure: Costs linked to the recently commissioned Pune manufacturing plant may weigh on margins until utilisation improves.
- Valuation scrutiny: Even with favourable currency movement, some analysts remain cautious on valuation and growth prospects, keeping ratings conservative.
Mixed Analyst Views on Outlook
While near-term headwinds persist, analysts are watching closely for Q3 earnings as a potential inflection point:
- Exports and product mix may support mid-single-digit revenue growth.
- Currency depreciation could help earnings.
- However, margin trajectory and the timing of new product launches remain key risks.
Some global brokerages retain positive medium-term views (e.g., Morgan Stanley and Citi maintain Buy calls), but also warn of cost pressures from expanded facilities.
Conclusion
Hyundai’s share weakness reflects a blend of policy-related impacts, margin uncertainty and softening demand in certain segments. The upcoming Q3 financial results will be critical in determining whether investor confidence can be restored and if the stock can stabilise or recover from recent declines.
