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Conference Call Details • Date: May 21, 2024 • Transcript submitted on: May 27, 2024 • Participants: MD and CEO Abhishek Jain, CFO Sachin Jain, Investor Relations Advisors • Regulatory submission to BSE and NSE; available on company website
Industry Overview • Indian automotive industry milestone: Over 4 million passenger vehicle sales in FY23-24 • Growth driven by new SUV launches and improved semiconductor availability • Industry growth expectations: 7-8% annually • Electric vehicle sector growth: 32%
Company Performance • Strong relationships with major manufacturers (Tata Motors, Mahindra & Mahindra) • Internal restructuring to enhance performance and reduce waste • Significant reduction in joint venture losses; profitability expected this year
Financial Highlights • Q4FY24: 4% increase in quarterly revenue, 11% rise in EBITDA • Full year: 2.3% growth in standalone revenue, gross profit margin of 40.6% • Anticipated improved performance in FY25 due to industry growth and strategic initiatives • Sustainability efforts: EcoVadis certification, goal to become neutral by 2040
Q&A Session Insights • Current capacity utilization: 75%, expected to exceed 80% in FY25 • EBITDA margin decline explained by lower sales and increased internal costs • Manufacturing rejection rates acknowledged but not disclosed • Aftermarket business contribution: 3%, with a target of 10% in coming years • Pail container business focus on industrial products; minimal impact from crude price fluctuations
Business Outlook • Stable margins for standalone and joint venture; improvements expected • Growth in aftermarket business with 123 distributors established • Increased content per vehicle for new models from Maruti and Tata • Strategic shift towards solar and energy storage solutions in battery pack business
Closing Remarks • Results below expectations, but optimism for improved EBITDA margins and operational performance • Clarification on net loss due to deferred tax liabilities (non-cash item) • Assurance of diligent efforts to enhance performance and better year ahead anticipated • Thanks to participants and organizing team
Submission Details • Date of submission: February 19, 2024 • Earnings call date: February 13, 2024 • Addressed to: BSE and NSE • Disclaimer: Potential transcription errors and forward-looking statements involve risks and uncertainties. • Key executives present: MD and CEO Abhishek Jain, CFO Sachin Jain. • Transcript available on the company's website.
Industry Overview • Automotive Growth: Highlighted growth potential in the Indian automotive industry. • Passenger Vehicle Production: Increased by 5% YoY to 1.14 million units in Q3 FY24. • Commercial Vehicle Sales: Rose to 240,000 units due to economic growth. • Tractor Segment: Experienced a 5% decline due to delayed harvests. • Two-Wheeler Segment: Significant recovery with a 23% YoY increase in sales to 4.7 million units.
Company Focus and Financials • Profitability Strategies: Emphasis on price hikes and cost reductions; current capacity utilization at 70%. • Electric Vehicle Contracts: Securing contracts for components and expanding the aftermarket division. • Financial Performance: Standalone revenue decreased slightly; EBITDA improved; consolidated revenue fell, leading to a net loss from the battery segment. • Future Outlook: Anticipated improved performance from volume growth, better product mix, and cost efficiencies.
Raw Material and Supply Chain Management • Raw Material Prices: Softening trend expected to lead to cost reductions. • Supply Chain De-risking: Exploring export opportunities; products shipped to UAE and US. • Cost-Plus Model: Adoption with OEMs to mitigate price fluctuations.
Business Segments • Aftermarket Contribution: Approximately 3% of topline with margins expected at 9-10%. • Commercial Tool Room: Gaining traction with an order book of over 65 tools. • Battery Business Challenges: Working on improving order book and addressing profitability concerns.
Future Expectations • Market Challenges: Anticipated challenges post-elections but expects growth from new product launches. • Debt Management: Plans to maintain debt levels around Rs. 150 crores; no major CAPEX plans currently. • Capacity Utilization: Currently at 70%, indicating potential for growth.
Q&A Highlights • Capacity Utilization Confirmation: Abhishek Jain confirmed utilization at 70%. • EBITDA Margin Concerns: Addressed concerns about current margins and strategies to improve them. • Joint Venture Performance: Clarified that while the JV's topline isn't consolidated, the combined automotive topline has grown by 10%. • Battery Business Discussions: Ongoing talks with three-wheeler manufacturers to scale operations.
Conclusion • Profitability Trends: Sachin Jain noted improving EBITDA margins and challenges in achieving price increases from cost-conscious customers. • Softening Commodity Prices: Expected to contribute to margin improvements. • Invitation to Tooling Exhibition: Abhishek Jain invited participants to the exhibition and encouraged further inquiries.
Earnings Call Overview • Date: November 17, 2023 • Transcript submitted on: November 23, 2023 • Key Participants: • Abhishek Jain (Managing Director and CEO) • Sachin Jain (CFO) • Focus: Financial results for the quarter and half year ending September 30, 2023
Industry Insights • Automotive industry sales growth: 1% year-on-year • Passenger vehicle segment growth: 6% • Notable performance from Maruti Suzuki • Challenges: Inflation and geopolitical issues • EBITDA margin improvement: 6.6% to 9.4% sequentially
Financial Performance • Standalone revenue growth: 13.1% year-on-year • PAT increase: 7.5% • Consolidated revenue growth: 15.5% • Sequential EBITDA rise: 94.6% • Optimism for FY24 due to favorable conditions and internal initiatives
Q&A Highlights • Revenue Contribution from Maruti: • Remains at 52% • Average content per vehicle: Rs. 2,500 to Rs. 3,000 • Higher figures for specific models (e.g., Jimny)
• Margin Improvements: • Recent price increases from Maruti positively impacting margins • Projected margins: 10% for the current year, 12-13% in FY25
• Electric Vehicle (EV) Business: • Ongoing collaborations with multiple EV customers • Focus on lithium-ion battery solutions, but delays noted
• Commercial Tool Room Business: • Order book: 55 tools • Capacity utilization: ~70% • Start of exports to the U.S. for industrial products
• Aftermarket Segment: • Contributes ~3% to total turnover • EBITDA margins: 9-10%
• Concerns Raised: • EBITDA margin expectations revised down to ~10% due to commodity price fluctuations • Debt levels increased to ~150 crores, monitored closely
Conclusion • The call concluded with expressions of gratitude and an invitation for further inquiries.
Submission Details • Date of submission: August 22, 2023 • Earnings call date: August 16, 2023 • Regulatory compliance: Sent to BSE Limited and National Stock Exchange of India • Transcript availability: On the company's website • Participants: Managing Director and CEO Abhishek Jain, CFO Sachin Jain
Industry Overview • Indian passenger vehicle industry: Third largest globally with growth potential • Passenger vehicle segment growth: 7% year-on-year • Auto components sector growth: 32.8% in FY '23
Financial Performance • Standalone revenue decline: From INR 116.3 crores to INR 111.4 crores • PAT loss: INR 1.6 crores • Consolidated revenue decline: PAT loss of INR 2.7 crores due to lithium-ion battery challenges • Optimism for FY '24: Recovery expected from industry tailwinds and operational efficiencies
Strategic Focus • New initiatives: Improved product mix and reduced input costs • Capital expenditure: Increased in the industry, aligned with OEM spending • Revenue growth target: Higher than historical CAGR of 12.5%
Battery Pack Business Insights • Projected growth: 40% to 50% year-on-year • Market share: Over 85% for Maruti, nearly 100% for Honda and Toyota • Revenue growth target: INR 100 to 125 crores for electric vehicle business
Customer Base and Diversification • Revenue concentration: Two customers account for 70% of business • Diversification efforts: Working to expand customer base while maintaining key relationships • Export strategy: Ongoing deemed exports with plans for a comprehensive strategy
Cost Management • Raw material costs: Constitute 80% of battery production costs • Indexation system: To align prices with commodity fluctuations • Recent decline in raw material costs: Expected to positively impact margins
Capacity and Focus Areas • Cautious capacity expansion: Focus on maximizing current utilization • Battery business focus: 3-wheeler applications, solar backup, and energy storage solutions • Application engineering: Equipped for tailored battery solutions
Conclusion • Abhishek Jain thanked participants and invited further inquiries about the company's facilities.
Submission Details • Date of submission: May 29, 2023 • Earnings call date: May 23, 2023 • Regulatory compliance: Sent to BSE Limited and National Stock Exchange of India • Key participants: Managing Director and CEO Abhishek Jain, CFO Sachin Jain • Document signed by: Pankhuri Agarwal, Company Secretary and Compliance Officer • Transcript available on the company's website
Industry Overview • Indian passenger vehicle industry growth: Surpassed Japan, projected to reach 6 million vehicles by 2030 • Automotive sector growth: Expected to rise from $222 billion to $300 billion by 2026 • Shift towards SUVs among younger consumers
Company Performance • Q4 FY '23: • Revenue increased by 2% year-on-year • EBITDA rose by 19% • FY '23: • Revenue growth: 20.4% to INR 492.3 crores (standalone), 21% to INR 511 crores (consolidated) • Parts business growth: 25% • Challenges: PAT loss of INR 5.9 crores due to pending tariff claims and battery business losses
Future Outlook • FY '24 expected to be pivotal with improved capacity utilization and tariff revisions • Capacity utilization forecast: 80% to 85% • Short-term debt increase: From INR 19 crores to INR 55 crores
Margin and Cash Flow Concerns • Current margin sustainability questioned; target margin of 13% to 15% • Increase in trade receivables and inventory acknowledged • Cash flow discrepancies raised but not clearly addressed
Electric Vehicle Segment • Debt linked to strategic initiatives; INR 28 crores attributed to electric vehicle business • Expectation for electric vehicle segment to become self-sustainable by the end of the current quarter
New Business Developments • Development of parts for Honda's new SUV, Elevate, with production starting next month • Aftermarket business (Elpis Automotive Limited) reported sales of INR 16 crores with a 9% EBITDA margin
Challenges and Strategic Initiatives • Decline in consolidated EBITDA margin from 9.9% to 6.7% due to Ptech sales drop • Employee costs linked to reorganization efforts; ongoing review of costs • Competitive pressures affecting gross margins despite decreased raw material costs
Key Raw Materials • Significant price increases in PVC, thermoplastics, and EPDM rubber over the past two years, with recent stabilization noted
Conclusion • Invitation for further questions via email; focus on improving margins, managing debt, and enhancing contributions from new business segments.