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85% of 2Ws to be impacted on ABS rule; Hero MotoCorp most exposed: Nomura
According to reports, the Ministry of Road Transport and Highways is expected to issue an official notification soon. The regulation is aimed at improving road safety by reducing accidents. ABS prevents wheel lock-up during sudden braking, helping maintain control and stability.
In FY25, two-wheelers below 125cc formed the majority of domestic volumes. Internal Combustion Engine (ICE) motorcycles in this category accounted for roughly 76 per cent of sales at 9.26 million units, while scooter sales—almost entirely under 125cc—stood at approximately 7.1 million units. Combined, these segments contributed 16.9 million units, representing about 85 per cent of total domestic two-wheeler sales.
Among OEMs, analysts at Nomura said Hero MotoCorp is likely to be the most impacted, with 99 per cent of its domestic volumes coming from the sub-125cc segment. Honda India follows with 89 per cent, while TVS Motor Company and Bajaj Auto are at 86 per cent and 72 per cent, respectively.
Proposed rules may weigh on demand
The proposed rule, while expected to boost safety, could weigh on demand, Nomura analysts said. The additional cost burden, estimated at ₹3,000 per unit (₹2,000 for the ABS unit and another ₹1,000 for a single disc brake where not already fitted), may lead to a price hike of 3–5 per cent.
OEMs are likely to pass this cost on to consumers, which could dent demand—especially in price-sensitive entry-level segments like 100cc motorcycles, scooters, and mopeds.
Industry demand could decline 2–4 per cent once the regulation is implemented, mirroring previous downturns following cost-driven changes such as higher insurance rates and BS-VI norms. Electric vehicles (EVs), too, excluding premium models like Ola S1 Pro and S1X Plus, will face pricing pressure.
'The percentage of revenue impacted for our covered OEMs could be: HMCL (about 79 per cent), TVS Motor (around 54 per cent), and Bajaj Auto (approximately 24 per cent). Most EVs, excluding Ola S1 Pro and S1X Plus, will also need to raise prices,' said Kapil Singh and Siddhartha Bera of Nomura.
However, the brokerage highlighted that component suppliers stand to benefit from this rule. ABS producers such as Bosch and Continental are key players in this space. In disc brakes, Endurance Technologies leads with major market share, alongside global names like Brembo and Nissin.
That said, while the regulation could be delayed for specific models due to required modifications, Nomura analysts believe the broader impact on the two-wheeler industry is expected to be major.
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