Rare earth material supply disruption
Rare earth materials used in gear sensors and alternators caused production issues for performance platforms (Himalayan, Guerrilla) in Q1. Mitigation via alternative materials is underway but remains a risk.
EICHERMOT / Q1-FY26 / risks
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Eicher Motors · Material risks, their source context, and severity in the latest available quarter.
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Material risks this quarter
medium
Commodity cost inflation
Steel and aluminum prices have risen, impacting margins by ~30 bps net in Q1. Further headwinds expected in Q2, with uncertain duration and magnitude.
Stagnant domestic two-wheeler industry growth
The Indian two-wheeler industry grew slower than expected in Q1, with 125cc+ segments not expanding. Royal Enfield's growth is coming from market share gains, which may be harder to sustain if the overall market remains weak.