JB Securities: Vehicle Import Momentum Slows Amid Fiscal Tapering 📈

• Overall Sector Dynamics Vehicle imports declined sharply to US$ 148.4 Mn in Feb 2026, down from a US$ 240.9 Mn peak in Dec 2025. While March registrations surged to 59,734 units (up from 51,682 in Feb), this was driven by existing dealer inventory rather than new imports. • Fiscal & Economic Impact In 2025, vehicle taxes generated Rs. 905 Bn, nearly double initial forecasts. This supported a record primary fiscal surplus of 5.3% of GDP. However, the current slowdown signals that the sector's outsized contribution to national growth and tax revenue is beginning to taper. • Energy & Fuel Outlook Fuel prices are expected to rise on 1 May. Diesel could hit Rs. 500/litre (buffered by a Rs. 100 subsidy) as CPC costs reached US$ 280/barrel. Petrol prices will see a milder hike with a Rs. 20/litre government subsidy. • Policy & Transition Highlights EV Sector: High fuel costs are expected to accelerate demand for Electric Vehicles, particularly for users with rooftop solar. Tax Reform: Experts advocate shifting from engine-capacity-based excise duties to a purely ad valorem (value-based) system to reduce market distortions and improve economic efficiency. _Note: Data based on JB Securities market analysis and provisional registration figures._