Future of Vehicle Leasing: A Growing Trend in India

ORIX Corporation India Ltd anticipates India's automobile leasing market to grow from 2% to 7-8% of vehicle sales in 5-7 years, driven by younger workforce preferences. With ties to OEMs like Maruti Suzuki and Kia, ORIX expects a 30-35% profit rise this fiscal year compared to last year.

ORIX Corporation India Ltd is forecasting significant growth in the Indian automotive leasing sector, predicting a rise from the current 2% to 7-8% of total vehicle sales in the next 5-7 years. This shift is attributed to the younger generation's preference for vehicle rentals over ownership, according to CEO Vivek Wadhera.

Despite the Indian market's nascent stage compared to the 30-40% leasing prevalence in the US, Japan, and China, ORIX has established partnerships with original equipment manufacturers like Maruti Suzuki and Kia. However, leasing remains a niche segment in India, where vehicle ownership is culturally preferred.

This year, ORIX expects a 30-35% increase in profit, surpassing last year's USD 12 million in India. By the fiscal year's end, profits are projected to reach USD 16-18 million. The company has experienced strong business performance across self-drive rentals, leasing, and financial services amid stable interest rates.

(With inputs from agencies.)