Auto export momentum offset by weak Q1; mid-teen growth reaffirmed but at risk

Order book healthy per management, but Q1 revenue only 4.3% YoY vs mid-teen guidance implies significant production shortfall

FY26 Q1 auto component export ₹90 Cr, Q1 FY27 ₹118 Cr = 31% growth

Down 35-40% in FY26 (~₹90-95 Cr), recovering to >₹130 Cr run-rate; but won't reach ₹250 Cr target, guidance ₹425-450 Cr auto export only (implies Allison ~₹130-150 Cr est)

Management stated; implies strong post-Q1 momentum but unverified

Q1 FY27 EBITDA ₹69 Cr / ₹304.3 Cr = 22.66% confirmed; prior Q1 FY26 ~21.6%

Q1 only 4.3% YoY; requires 5-6 quarters of ~18-20% growth to hit 15-17% annual target — very back-loaded, risky given freight headwinds and labor constraints emerging seasonally

Auto export ₹118 Cr in Q1 (31% YoY growth), now 39% of total revenue vs prior ~30%. Strategic shift is working; target ₹425-450 Cr for FY27 (vs ₹350 Cr FY26).

EBITDA margin 22.6% vs 21.6% prior Q1; 3rd consecutive quarter of YoY expansion. Driven by auto export mix, cost control, and favorable input sourcing despite labor overtime.

One customer's order cancellation in Europe hit industrial bearing revenue down 6% QoQ. Domestic industrial also soft. Management developing new customers but no recovery timeline given.

Ocean freight to US now 2.5-3x normal (~INR2-3 Cr/shipment vs INR0.8-1 Cr); persists through Q2. Management conservative on margin guidance (21-22%) as a result; prior guide was 20.5-21%.

Seasonal: April-May-June hottest months, vacation + wedding season, agricultural workers go home. Temporary, managed with overtime. Semi-skilled staff have long tenure, so management won't lose them.

Won't hit INR250 Cr. Down ~₹90-95 Cr in FY26, now recovered 30%+ to ~₹130 Cr est. For FY27 auto export guidance of ₹425-450 Cr, Allison is ~₹130-150 Cr (est ~30-35% of segment).

Marginal growth expected next couple quarters. One customer lost orders in Europe; developing new customers but no timeline. Domestic auto-bearing (not industrial) holding strong.

EBITDA margin conservatively 21-22% FY27 due to freight. FY28 could be +50 bps higher if volume scales and freight normalizes. Contracts are cost-pass-through on raw material/forex, not freight.

Not ₹500 Cr. Confident to cross ₹425-450 Cr. With ₹117 Cr annualized from Q1, ₹450 Cr is achievable if other programs ramp.

Hard to change existing DAP/DDP terms. But customers are helping; one already changed terms. Approaching others; expect reimbursement of high freight expenses in coming quarters.

No material change. Timken's own business down. Strategy is develop new customers, not depend on single customer.

Very preliminary. Looking for value-added processes where third party has ready market access. Global agency appointed; expect decision in 6-9 months. Likely stay India-based for production.

Very preliminary. Registrations initiated, approval certification in progress. Hope for defense revenue in 12 months. Aerospace exploration ongoing. Working with third-party consultants.

Confident. Order book healthy, constraints were execution-based (labor, geopolitics), not demand. July was best month ever. Q2 should show better strength as labor normalizes.

Reaffirmed on call but Q1 only 4.3% growth. Assumes strong Q2-Q4 (18-20% required) to hit target. Labor normalization, Allison ramp, new programs key drivers. Ocean freight headwind is wildcard.

Not formally stated, hinted at as 'more than mid-teen, close to 20%'. JV contributions, defense entry, and new customer wins in new segments would be required.

Based on Allison recovery, new programs ramping, 1-2 new plants starting. Q1 ₹118 Cr annualizes to ~₹450 Cr; achievable if momentum sustains.

Q1 achieved 22.6%; management guiding lower due to ocean freight headwind (2.5-3x normal), which persists through Q2. Prior guidance was 20.5-21%, so this is ~50 bps upgrade, not reflected in conservative framing.

Dependent on freight normalization, continued auto export mix improvement, and capex leverage. Requires freight cost reversal and/or customer reimbursement success.

Modest capex reflects existing capacity utilization still at 63-65%, targeting 70-72% by end FY27. New capacity not imminent; JV model may defer capex to partner.

Allison represents ~₹30-35 Cr of FY27 growth. Loss or slowdown of this customer would significantly impact FY27 mid-teen guidance. However, management has long-term relationship and customer has diversified via Dana acquisition.

Ocean freight 2.5-3x normal (~₹2-3 Cr per shipment to US vs ₹0.8-1 Cr); persists through Q2 at least. No clear resolution timeline. Vessel availability to India also constrained (shipping lines not returning vessels to India due to geopolitical reasons).

Bearing ring export down -8.5% YoY (₹32 Cr). Timken customer's business significantly reduced; Rolex has no material recovery plan. Industrial segment affected by one European customer's order cancellations; domestic industrial also soft.

Q1 labor shortage deferred output by est. 1-2 Cr. Management says temporary and managed with overtime, but risk re-emerges if next summer is hotter or if wage inflation accelerates. Seasonal pattern expected to repeat in April-May-June annually.

Q1 only 4.3% YoY growth vs mid-teen guidance. Requires 18-20% growth in Q2-Q4 to hit target. Ocean freight headwind (material, persisting), labor constraints (seasonal but recurring), and Timken weakness are headwinds. Allison recovery is progressing but from depressed base.