Citi flags improving macro environment for auto makers, prefers Maruti and Mahindra

Citi has projected a favourable outlook for Indian automobile sales in 2026, citing supportive macroeconomic tailwinds such as easing inflation, improving rural demand, and stable interest rates. The brokerage expects volume growth to pick up across segments, with passenger vehicles and SUVs leading the recovery. Maruti Suzuki and Mahindra & Mahindra remain Citi’s top sector picks, backed by strong product pipelines, pricing power, and improving margin visibility.