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Minda Corporation Limited Q1 FY25 Earnings Conference Call Summary
Submission Details • Date of submission: August 14, 2024 • Call date: August 8, 2024 • Compliance: Submitted to National Stock Exchange of India and BSE Limited per SEBI regulations • Host: Nuvama Wealth Management • Key management present: • Aakash Minda (Executive Director, Finance & Strategy) • Vinod Raheja (Group CFO) • Sameer Sharma (Group Head – Strategy & M&A) • Nitesh Jain (Lead Investor Relations)
Financial Highlights • Revenue Growth: 11% year-on-year, reaching INR 1,192 crores • EBITDA: Increased by 15% to INR 132 crores • Profit After Tax: INR 64 crores, reflecting a 42% growth • Order Book: Total lifetime order book of INR 2,100 crores • Joint Venture: Formed with HCMF of Taiwan for automotive sunroof systems
Strategic Focus • Innovation: 280 patents filed, increased R&D spending from 1.4% (FY21) to 3.0% (FY24) • Product Range: Diverse offerings in electrical distribution systems, advanced electronics, and mechatronics • Transition: Moving towards smart vehicle access systems and electric two-wheeler products
Market Insights • Passenger Vehicle Segment: Growth opportunities identified • Domestic 2-Wheeler Market: Strong demand noted • Export Revenue: Contributed 9% of total revenue, down 2-3% year-on-year
Q&A Highlights • Joint Venture Details: $1 million initial investment, targeting INR 7,800-8,000 crores market potential by 2028 • EV Revenue: Constitutes 5-6% of total revenue, with challenges from underperforming start-ups • Smart Key Business: Expected growth from 3-5% to 30-40% by 2030
Inorganic Growth and M&A • Ongoing discussions for mergers and acquisitions, particularly in instrument clusters and die-casting sectors • Emphasis on financial prudence and core competencies
Future Outlook • EBITDA Target: Aiming for 10.5% to 11% sustainable growth • Production Plans: Significant smart key order production expected next quarter • Confidence in Growth: Anticipating to outperform the industry by 5% to 8% in the coming years
Conclusion • Commitment to consistent, profitable growth and value creation for stakeholders reaffirmed.
Minda Corporation Q3 FY24 Earnings Conference Call Summary
Submission Details • Date of submission: February 9, 2024 • Earnings call date: February 2, 2024 • Compliance with SEBI regulations • Key management present: Aakash Minda, Vinod Raheja, Pushpa Mani
Call Format • Welcome by Raghunandhan NL of Nuvama Research • Structure: Opening remarks followed by Q&A • Caution advised for forward-looking statements
Financial Performance Highlights • Revenue Growth: 9.1% year-on-year to Rs. 1,166 crores • EBITDA Margin: Improved to 11.1%, 13.8% year-on-year growth • Profit After Tax: Rs. 52 crores, PAT margin of 4.5% • Domestic Business Growth: 16% increase
Key Developments • Order Wins: Exceeded Rs. 2,300 crores, over 30% from EV platforms • Total Order Book: Rs. 8,900 crores for first nine months of FY24 • New Facility: Smart key facility inaugurated in Vietnam • Patents Filed: Eight new patents, total of 265
Strategic Focus • Emphasis on premiumization, market share expansion, and localization • Interim dividend recommended: 25% • Leadership enhancement with reinstatement of Mr. Ravi Sud as Independent Director
Segment Performance • Revenue Model: 85-87% from India • Key Segments: Wiring harnesses (30-33%), locksets (25%) • Mechatronics Division: 5% quarterly growth • Connected Systems Division: 13% growth
Q&A Session Insights • Delayed Orders: 3-4% of revenue, expected resumption in Q4 • Wiring Harness Growth: Strong double-digit growth due to localization • EV Components: 5-6% of total sales, 11-11.5% in two-wheelers • Order Translation: 12-24 months for new orders to convert to sales
Growth Strategy • Key Drivers: New order wins, product premiumization, market expansion, new product introduction • Market Share Projection: Increase to 4-5%, revenue target of Rs. 800-900 crores for FY25 • CAPEX Plan: Rs. 300-450 crores annually for next two years
Financial Management • Net Debt: Approximately Rs. 450 crores as of December 31, now net cash • Interest Costs: Balanced approach to financing and debt repayment
Future Outlook • Vietnam Plant: Focus on serving OEMs and ASEAN market • Localization Rate: 15% currently, aiming for increase • Smart Key Penetration: Projected to rise to 20-25% by FY26-27 • EV Revenue Share: Expected to reach 10-15% in the same timeframe
Commitment to Quality and Innovation • Focus on profitability, capital allocation, and community contribution • Emphasis on R&D investment, particularly in EVs and premiumization across product lines
Minda Corporation Q2 FY '24 Earnings Conference Call Summary
Submission Details • Date of submission: November 9, 2023 • Compliance with SEBI regulations • Key executives present: Aakash Minda, Vinod Raheja, Pushpa Mani • Hosted by: Asian Market Securities • Included forward-looking statements with cautionary reminders
Financial Performance • Quarterly Revenue: INR 1,196 crores • 7% year-on-year growth • 11.3% quarter-on-quarter growth • Domestic Sales: Increased by 10% year-on-year • Exports: Faced challenges due to geopolitical issues • EBITDA: INR 131 crores with an 11% margin • Profit Before Tax: INR 77 crores • Profit After Tax: Increased from INR 45 crores to INR 59 crores
Key Developments • Joint Venture: With Taiwan's HCMF for automotive sunroof solutions • Anticipated market opportunity of $500-$600 million by 2030 • Expected capital expenditure: INR 150-180 crores over three years • Electric Vehicle (EV) Sales: 5.2% of total sales • Order Wins: INR 6,500 crores in H1 FY24, with 30% from EV segment
Strategic Focus • Enhancing manufacturing capabilities and technological upgrades • Increased R&D spending, particularly in EVs • Commitment to ESG initiatives and corporate social responsibility
Future Growth Expectations • Aim to outperform the industry with a growth rate of 15% • Anticipated increase in profitability due to operating leverage • Focus on premiumization of products and new product lines in power electronics
Operational Insights • Wiring harness business: Capacity additions expected to improve margins • Significant order for smart key solutions worth INR 450 crores • Transition from traditional systems to smart keys • 100% market share in smart key solutions for two-wheelers in India
Market and Competitive Landscape • Sunroof market projected growth and existing competition • Rising employee and operational costs attributed to expansion and new product development • Cautious optimism for export performance improvement in upcoming quarters
Conclusion • Minda Corporation is positioned for continued growth through innovation and strategic partnerships, with a strong focus on enhancing its product portfolio in EVs and electronics.
Submission Details • Date of submission: August 9, 2023 • Compliance with SEBI regulations • Hosted by Dolat Capital • Key personnel: Aakash Minda (Executive Director), Vinod Raheja (Group CFO), Anshul Saxena (Group Head of Strategy)
Earnings Highlights • Industry Growth: Moderate growth in auto industry, especially in two-wheelers and SUVs; subdued demand for commercial vehicles and tractors. • Financial Performance: • Revenue: INR 1,075 crores (6.4% YoY increase) • EBITDA Margin: 10.7% • Profit Before Tax: INR 63 crores • Product Development: Focus on in-house products, particularly two-wheeler smart keys; lifetime orders worth over INR 3,000 crores (50% from EV segment).
Operational Insights • Efficiency Improvements: Enhanced efficiencies in lock-set and die-casting divisions; rising smart key volumes. • Information Systems Division: Revenue increased by 8.5% (from INR 518 crores to INR 562 crores); stable margins at 8.6%. • R&D Investment: 3% of revenue allocated to R&D; over 500 engineers and 255 patents.
Q&A Session Highlights • Die-Casting Revenue: 13% increase in die-casting revenue (from INR 184 crores to INR 208 crores). • New Orders Breakdown: INR 400 crores for replacements, INR 2,600 crores for new businesses. • Growth Targets: Commitment to 20-25% growth for FY '24 driven by technology and new customer acquisitions.
Future Outlook • Electric Vehicle Segment: Projected kit value increase to INR 16,000-20,000; EV revenue growth from 2% to 5.5-6% of total sales. • Margin Expectations: Anticipated improvement in margins due to increased software and electronics content. • Growth Strategy: Targeting 12%-13% EBITDA; focus on operational excellence, product premiumization, and advanced technologies.
Financial Position • Gross Debt: Confirmed at INR 570 crores. • Market Share: Significant shares in lock sets (over 40%) and wiring harnesses (30% for two-wheelers).
Conclusion • Minda Corporation remains optimistic about growth despite potential quarterly fluctuations, focusing on sustainable practices and enhancing competitive edge through R&D and product innovation.
Minda Corporation Limited Q4 FY23 Earnings Conference Call Summary
Submission Details • Date of submission: May 24, 2023 • Conference call date: May 19, 2023 • Hosted by: Dolat Capital • Key personnel: Aakash Minda (Executive Director), Vinod Raheja (Group CFO) • Compliance: Submitted to National Stock Exchange of India and BSE Limited per SEBI regulations
Financial Performance • Revenue Growth: • Q4 revenue: INR 1,075 crores (up 13.4% YoY) • Full-year revenue: INR 4,300 crores (up 45% YoY) • EBITDA Margin: Improved to 10.7% • Net Profit: Normalized PAT of INR 219 crores • Dividend: Final dividend of 40%, totaling 60% for the year
Market Insights • Industry Growth: Double-digit growth in most automotive segments; two-wheelers faced sluggish demand. • Order Book: INR 7,800 crores, with 20% from electric vehicles (EVs) and over INR 1,000 crores in export orders. • Strategic Investments: Acquired 15.7% stake in Pricol.
Business Segmentation • Wiring Harness: Critical for vehicles, with 50% revenue from two-wheelers. • Mechatronics Division: Holds over 40% market share in two-wheeler locksets; potential for smart lock penetration to rise from 5-7% to 30-40%. • Die Casting: 40% YoY growth, reaching INR 730 crores.
Growth Strategy • Capacity Utilization: • Mechatronics and wiring harness: 55-60% • Interior plastics: 80% • EV division: 25-30% • Future Plans: Focus on R&D, digital transformation, and enhancing EV offerings. • Sustainability: Commitment to ESG initiatives and localization of components.
Challenges and Responses • Macroeconomic Factors: Addressing supply chain disruptions and commodity inflation. • Working Capital Management: Actively reducing inventory days and improving cash flow. • Partnerships: Collaborations for ADAS and telematics solutions.
Long-term Outlook • Return on Capital Employed (ROCE): Targeting an increase from 15% to 20% over three years. • Growth Commitment: Focus on innovation, strategic partnerships, and sustainable growth.
Minda Corporation Limited Business Update Conference Call Summary
Conference Call Overview • Date: February 20, 2023 • Submitted transcript to: National Stock Exchange of India and BSE Limited • Key Participants: • Aakash Minda (Executive Director) • Vinod Raheja (Group CFO)
Growth Prospects • Focus on automotive instrument cluster sector. • Recent investments: • INR 161 crores for a 49% stake in Minda Instruments. • INR 400 crores for a 15.7% equity stake in Pricol.
Financial Strategy • Target debt-to-equity ratio: ~0.3. • Emphasis on maintaining a strong balance sheet. • Confidence in cash flow generation and growth potential.
Q&A Highlights • Future Intentions with Pricol: • Minority position without special rights; evaluation of inorganic opportunities. • Capital Allocation Concerns: • Defense of aggressive strategy; strong balance sheet supports investments. • Technology Investments: • Active evaluation of organic and inorganic opportunities.
Premiumization Strategy • Transition from analog to advanced digital instrument clusters. • Expected value increase from INR 500-700 to INR 4,000-5,000. • Aim to outperform market growth by 10-12%.
Financial Health • Total net debt: INR 400 crores. • Cash reserves: INR 150 crores; net short-term debt: INR 260 crores. • Sufficient free cash flow for operational needs and future acquisitions.
Investment Approach • Investments evaluated based on synergies and potential returns. • No prior discussions with Pricol's management before investment. • Future exit strategies not a current priority.
Conclusion • Optimism about growth trajectory and market position in the automotive instrument cluster sector.
Minda Corporation Limited Q3 FY2023 Conference Call Summary
Key Highlights • Date of Call: February 8, 2023 • Revenue Growth: 45% year-on-year to Rs. 1,068 Crores • EBITDA Margin: Consistent at 10.7% • Interim Dividend: 20% declared • Employee Count: 16,000 across 34 plants
Significant Developments • Technology License Agreement: With LocoNav for telematics software • Patents Filed: Five new patents • New Plant: Inauguration of a wiring harness plant in Pune • EV Market Focus: 24% of order book from EV-related products
Financial Performance • Profit After Tax (PAT): Rs. 52 Crores, a 41% increase • Revenue Breakdown: • Two-wheelers: 44% of revenue • Strong domestic market performance
Future Outlook • EV Kit Value Enhancement: Projected increase from Rs. 4,000-5,000 to Rs. 16,000-20,000 • ESG Initiatives: Focus on education, women's hygiene, and support for disabilities • Awards: 57 external awards received in Q3
Q&A Session Insights • Employee Costs: Increased due to minimum wage hikes • Debt Status: Total debt at Rs. 417 Crores • Wiring Harness Division: Underperformance acknowledged, with plans for improvement • Product Plans: Adaptable to both ICE and EV markets, exploring "China plus" opportunities • Export Geographies: Active in Europe, America, and Southeast Asia
Capacity and Utilization • Wiring Harness Facilities: Eight facilities with varying modernization needs • Capacity Utilization: • Wiring harness: 25% • Die casting: 85-90%
Raw Material Prices • Fluctuations: Key commodities like copper and aluminum noted • Mitigation Strategies: Arrangements with customers and suppliers to manage price changes
Conclusion • Commitment to Growth: Focus on sustainable growth, technology, and operational excellence • Future Plans: Continued expansion in EV offerings and product development