Auto Ancillary Stocks Poised for 20-25% Growth: SBI Securities

• SBI Securities identifies auto ancillary sector for strong growth, driven by rising volumes, exports, and strategic diversification.
• Sunny Agarwal anticipates 20-25% earnings CAGR over 2-3 years for selected companies, capitalizing on broader auto sector recovery.
• Post-GST rationalization led to a strong uptick in volumes across all auto sub-sectors; H2 FY26 expected to be robust for CV and Tractors.
• Mid-sized companies (₹5,000-₹15,000 crore market cap) are well-positioned for significant growth.
• Tire manufacturers are platform-agnostic beneficiaries; CEAT is specifically recommended due to its focus on 2W/PV and strong brand.

Why It Matters: SBI Securities sees strong growth in auto ancillary sector, recommending mid-cap and tire stocks like CEAT.