Hyundai India’s third-quarter results were poor, but experts expect some improvement in sales by FY26 owing to capacity expansion and new models.
The Q3 fiscal 2025 results encouraged peers to improve performance, as product development is a focus and manufacturing is viewed as a growth sector. In the third quarter of fiscal year 2025 (Oct 2025), Hyde Motor India reported a 19% reduction in net profit to ₹1,124 crore and a 2.1% decline in turnover (sales) to ₹16,242 crore compared to the previous fiscal year. The performance of Hyundai fell short of market assumptions, implying that the company still struggles with the slowdown in the home market as well as international markets.
Market Challenges
The domestic passenger vehicle market demonstrated reduced sales figures after an active festive period. According to Citi Research analysts, the geopolitical situation caused export demand to weaken. The economic environment presents difficult conditions for Hyundai India because both the company’s primary product sales and its main vehicle model Creta heavily depend on market performance.
The weak demand conditions across the market sector create stronger pressure on Hyundai’s sales performance says the management. Maintaining a stand-alone net profit during the quarter became difficult for the company because of market conditions which resulted in revenue and profitability declines.
Financial Performance
The standalone revenue for Hyundai reached ₹16,242 crore in Q3 FY25 despite missing Bloomberg estimates of ₹17,089 crore. EBITDA dropped by 14% to ₹1,825 crore as the EBITDA margin decreased 160 basis points to 11.2%. The operating margins experienced a decrease mainly because stock discounts became greater along with increased labor expenses including a one-time reward during the IPO.
Overall Hyundai enjoyed positive product outcomes in Q3 as SUVs maintained two-thirds control of total volumes. Hyundai sustained substantial revenue during the quarter due to the powerful performance of SUVs while discount rates increased substantially. Cost efficiency measures helped mitigate margin consequences stemming from reduced demand together with export barriers created by geopolitical difficulties.
Focus on Electric Vehicles
Hyundai India will use their upcoming Creta Electric model to boost sales performance in the year 2025. Hyundai’s internal combustion engine Creta SUV model currently leads its market category while boosting Hyundai’s total sales performance. Hyundai plans to bring the same achievement it amassed for ICE coverage to electric vehicles.
The Creta Electric plays a pivotal role in Hyundai’s twin aspirations of becoming a driving force behind India’s EV industry and achieving its target market share of 20% by 2020. Hyundai is gearing up to launch three new vehicle models in the “Creta plus” and “Creta minus” segments to cater to different market customer needs.
Production Increase
Later this year Hyundai’s Pune factory will begin its operations and plans to expand its annual manufacturing capacity from 899,000 units to 1.1 million units each year. The project expansion plays an essential role as it helps Hyundai fulfil future model requirements while implementing its strategic growth objectives.
Analysts predict that Hyundai India will gain manufacturing efficiency and operational flexibility when their Pune facility goes online. The expanded capacity creates conditions for improved inventory handling and faster reaction to market modifications.
Market Outlook
Hyundai India encountered recent difficulties yet the company identifies promising developments which could shape its future performance. Rural markets appear to be recovering, with penetration increasing from 19.7% to 21.2% year on year during Q3 FY25, despite some anticipated decline in urban demand. According to current projections, market growth in 2025 will most likely be in the single-digit range.
After heavy discounting in Q3 FY25, the price dynamics are stabilising. Hyundai stocks are still being recommended for buying by analysts as the increased production volumes for vehicles are being forecasted due to the expansion of existing facilities and new model launches.
Competitive Positioning
Premium product development represents an essential part of Hyundai India’s market growth strategy. Monthly sales data reveals that SUV models represent 70 per cent of all Hyundai vehicle purchases because customers choose larger vehicles. Through its introduction of dual-cylinder technology, Hyundai expanded CNG penetration across models such as the Nios hatchback and Exter subcompact SUV which boosted penetration from 12% to 15% while reflecting its capability to meet consumer demands.
Half of all Hyundai models sold in India currently feature sunroofs because customers want refined luxury options in their purchases. Sunroof installations in Hyundai vehicles exceed 50 percent at present indicating that India’s customers favor luxurious options which balance both comfort and style elements.
Export Performance
Hyundai India maintained consistency in export operations during the December quarter despite market difficulties by shipping 40,386 vehicles out of the country. The company has established itself as an emerging markets centre serving customers in the Middle East alongside Latin America and Africa.
Despite these obstacles, the company is making progress. Expanding Pune production capacity, as well as developing Creta Electric, will be critical commercial measures to boost sales of both normal and electric vehicles. Under the current conditions, Hyundai India is keeping its options open for a market recovery, with a dual strategy that includes rural expansion and premium market development, as well as solid export performance.
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