Auto stocks extended their winning streak for the third consecutive session on Wednesday, with the Nifty Auto index rising over 0.7% to 28,396.30 as of 11:15 am. The sector rally was driven by positive December sales reports from major automakers. Ashok Leyland shares led the gains, rising more than 2.5% to ₹183.66, while the company is yet to release its monthly sales data. Escorts Kubota shares, though not part of the Nifty Auto index, surged over 3% to ₹3,850, reaching a monthly high following the tractor maker's stellar December performance. Other gainers included TVS Motor Company and Tube Investments of India, which rose over 1%, while Tata Motors Passenger Vehicle, Maruti Suzuki, Samvardhana Motherson, Bajaj Auto, Bharat Forge, and Exide Industries traded in the green with marginal gains.
Mahindra & Mahindra shares rose more than 1% to ₹3,755.80 after reporting a 25% year-on-year increase in December sales to 86,090 units. The company achieved record-breaking performance across segments, with SUV sales reaching 50,946 units, marking 23% growth, and LCV sales under 3.5T hitting 24,786 units with 34% growth. "The calendar year 2025 ended on a positive note, with Mahindra clocking its highest-ever volumes in both SUVs and LCVs (<3.5T) segments, a significant milestone for the company," said Nalinikanth Gollagunta, CEO of Automotive Division at M&M. The strong performance was supported by India's tax reduction on SUVs with engines above 1500 cc to 40% from about 50% in September, benefiting most of Mahindra's SUV range.
Escorts Kubota Limited continued to demonstrate robust growth in its tractor sales for December 2025, with the Agri Machinery Business Division recording a 38.5% year-on-year increase. The company sold 7,577 tractors in December 2025 compared to 5,472 tractors in the same period last year, demonstrating strong momentum in the agricultural machinery sector. Domestic tractor sales reached 6,828 units in December 2025, marking a 36.1% growth compared to 5,016 units sold in December 2024. For the October-December (Q3) FY26 quarter, Escorts Kubota sold 36,955 tractors, registering 13.5% growth over the same period last year. The April-December FY26 period saw total tractor sales of 1,01,413 units, up 14.0% YoY from 88,921 units, with domestic volumes growing 12.6% over the same period last year.
Export tractor sales demonstrated exceptional performance, with 749 tractors sold in December 2025 compared to 456 tractors in December 2024, representing a significant 64.3% increase. The company's Farmtrac, Powertrac, and Kubota brands continued to gain market share across select international markets, reflecting rising global demand for cost-efficient, reliable farm machinery. The robust export performance contributed significantly to the overall growth momentum, with exports rising 53.9% for the April-December FY26 period compared to the same period last year. While domestic volumes tracked the broader industry recovery, exports significantly outperformed, highlighting the company's increasing strategic leverage beyond the Indian market. The strong sales performance has driven Escorts Kubota shares to their highest level in a month at ₹3,850, reflecting investor confidence in the agricultural machinery manufacturer's growth trajectory.
The broader auto sector's positive momentum reflects improving demand fundamentals across segments. While some stocks like Eicher Motors, Hero MotoCorp, Bosch, and Sona BLW Precision Forgings bucked the trend to trade in the red, the overall sector sentiment remained positive. The domestic tractor industry's sustained strong performance in December 2025 was driven by multiple positive factors including supportive government policies, reduced Goods and Services Tax (GST) rates, and continued state subsidies enhancing affordability for farmers. The industry also benefited from strong Kharif crop output, enhanced Rabi sowing compared to the previous year, increased water availability, and positive rural sentiment. Industry analysts note that the performance mirrors a larger transformation underway in Indian agriculture, with stable policy support and improving fundamentals strengthening demand across agricultural machinery and automotive segments.
