Is the auto sector’s good luck running out? Not yet, say most experts, even after the October 2025 festive rush. The automobile market roared with a whopping 40.3% jump in sales compared to last year! This huge surge is thanks to the festive season and cheaper prices after the GST rate cut. The Federation of Automobile Dealers Associations (FADA) reports that every segment saw growth. This buzz also lit up the stock market. The BSE Auto Index jumped by 8.5% in three months, leaving the BSE Sensex’s 4.2% rise in the dust. It is the second-best performer among BSE’s 18 sector indexes for this year till mid-November. But some experts sound a caution horn. They say the real test is if this demand can keep zooming after the festivities cool down. FADA is optimistic, pointing to several good factors that should keep sales high: strong economy, cash flowing in from farms after harvest, marriage season demand, better stock levels in showrooms, upcoming new models, and steady fuel prices. Anubhav Mukerjee from Prescient Capital sees the demand engine humming well into the near future but warns growth might slow down. He lists things boosting sales: the lower GST rates, tax cuts for individuals, more people replacing old vehicles, better rural buying power, and dealers restocking normally. Segment-wise, two-wheelers are the star players. Subhash Gate from Choice Institutional Equities says good rains, rural recovery, and easier loans are firing up this segment. Tractors and light commercial vehicles (LCVs) are also driving growth due to ongoing rural money flow and government infrastructure work. Passenger vehicles, however, might take a back seat. Though demand stays steady, factors like a high sales base, longer replacement cycles, supply shortages for some models, and limited fresh demand could slow the pace. Investor feelings are mixed. Motilal Oswal’s recent report spots doubts among foreign investors about demand lasting beyond January 2026. Some fear small car sales may drop when festive discounts end next year. Still, reports from Emkay and ICRA keep a hopeful tone but stress watching post-festive sales trends closely. Looking at auto stocks, the sector is financially strong with solid profits expected ahead. Even if some stock prices look high, many companies have strong cash and good balance sheets. Anil Rego of Right Horizons PMS points out the sector’s mix of quick wins in commercial vehicles and tractors, plus long-term growth from electric vehicles, hybrids, and connected tech. He advises picking stocks carefully, not blindly betting on the whole sector, because high prices leave little room for mistakes. Top players show strong numbers: - Maruti Suzuki grew revenue 13% and profit 7.3% in the September quarter. With 8 new SUVs planned by 2031, they aim for a big 50% share in passenger vehicles and export targets over 4 lakh. - Mahindra & Mahindra posted 21.3% revenue and 17.7% profit growth, driven by strong sales in automobiles and tractors plus cost savings. They raised their outlook on tractors and LCVs. - Bajaj Auto saw 13.7% revenue and 23.7% profit growth, thanks to higher prices, exports to Latin America, and stronger commercial vehicle sales. Their Rs.4500 crore cash flow shows financial muscle and potential for higher stock value. So, is the auto sector’s race going full speed or slowing down? For now, the engine sounds strong, but everyone’s eyes are on what happens after the festive fuel runs out!