Crisil Ratings stated that the ratings continues to reflect the company’s established position in domestic and overseas passenger car markets, robust financial risk profile and strong liquidity.

The factors also factor in the strong support from the parent, Hyundai Motor Company (HMC).

In fiscal 2026, HMIL’s overall volume marginally increased by 2% on account of improved business volumes, particularly during the second half of the fiscal year, on the back of goods and services tax (GST) rate rationalisation in September. As a result, revenue of HMIL increased to Rs 70,763 crore in fiscal 2026 from Rs 69,193 crore in fiscal 2025.

Sustained volume offtake supported by new model launches, especially in the sports utility vehicle (SUV) segment, along with moderate price hikes is expected to support volume growth in fiscal 2027, with revenues expected above Rs 75,000 crore.

Operating profitability moderated to 11.7% in fiscal 2026 from 12.6% in fiscal 2025 owing to input cost pressures. With sustained volume growth improving the product mix and calibrated price hikes, HMIL is expected to sustain the operating margin at healthy levels over the near to medium term.

The financial risk profile remains robust, supported by negligible debt and strong liquidity driven by annual cash accrual, with sizeable cash surplus and bank balance (Rs 10,552 crore as on 31 March 2026). Capital expenditure (capex) spend in fiscal 2026 was largely met through available surplus and annual cash accrual.

These strengths are partially offset by susceptibility to intense competition in the domestic passenger vehicle (PV) industry and fluctuations in foreign exchange (forex) rates.

Hyundai Motor India (HMIL) is the fourth-largest player in the Indian passenger vehicle (PV) industry and the second-largest exporter of PVs. The company has access to Hyundai Motor Company's (HMC's) technology and large product portfolio and pays royalty to the parent on both domestic and overseas sales.

The scrip had shed 0.14% to end at Rs 2219 on the BSE on Friday.