Strong revenue, margin squeeze; long-term scale-up credible

Delivered 20.4% YoY (₹1,846 Cr vs prior year ~₹1,533 Cr)

Delivered 14.0% YoY PAT growth (₹168.7 Cr vs ~₹148 Cr prior year)

OPM delivered 15.5%, below both cited levels

20% revenue growth - RM inflation ₹20-25 Cr ≈ 1.1-1.35% impact; implies ~18.7-19% ex-inflation

Management confirmed contractual pass-through with OEMs, but indirect cost negotiations ongoing

₹400 Cr FY27 announced (vs ₹300 Cr prior annual target); 30% replacement, 70% growth. Signal of confidence in pipeline.

Class 8 trucks order backlog at 38-month high; North American capacity constraints emerging; EV export business accelerating vs prior YoY deceleration.

GM + Stellantis combined targeting ₹200-250 Cr FY27 (from <₹50 Cr FY26); management cited multi-year visibility with Stellantis on both ICE/PHEV and EV platforms.

Q1 OPM 15.5% missed 16.5% target; management now expects improvement in Q2 once indirect cost negotiations conclude (timing slipped from Q1 implicit).

Aerospace ₹100 Cr+ FY27 (targeting ₹500 Cr in 2-3yr), Wind ₹500 Cr run rate expansion (vs ₹350 Cr annualized), both backed by capex committed; confirms prior 'non-auto growth' strategy with hard numbers.

D/E 0.1-0.2, very strong liquidity. RM pass-through contractual (OEM settlement model). Aftermarket raises prices. Exports protected via rupee depreciation. No finance risks; rates held.

Capex for non-auto expansion. Auto capex per customer needs. All projects on timeline. West Asia machinery imports monitored case-by-case. Financing no concern. Capex as planned.

20% new product metric on 3-year basis, almost achieved. Added products + customers across verticals. ₹1,000 Cr+ pipeline of new projects, equal magnitude in discussion.

Drivers: wind, aerospace, industrial fasteners. Defense in startup mode; understood to have long validation cycle. Non-auto is to beat auto cyclicality (CV/PV swings). Twin-engine strategy.

Clear uptick in demand beyond forex. Car segment: EV projects behind us, ICE back on stage, North America volumes picking up. Trucks: Class 8 rebound strong (20-25% order increase YoY, 38-month backlog high). Drivers: construction, fleet replacement, EPA27 pre-buy. Heavy-duty strong, medium duty better.

₹200-250 Cr FY27 expected from GM (base <₹50 Cr FY26). Initial projections had ₹750 Cr at peak, but taking one year at a time. Plan for FY27 is high and on track based on Q1.

ICE and PHEV picking up well. EV platforms also contracted. Uptick expected in ₹200-250 Cr range combining GM and Stellantis.

Direct materials: no negotiation, contractual pass-through per OEM-mill settlement. Indirect materials: under negotiation. EBITDA 16.1% now, expect toward 16.5%. Indirect accrual should expand margin Q2.

Good business acquisitions: Garrett Motion machined parts for turbos (2 divisions acquired). ZF at Sri City hybrid. Europe % of exports grown past 2-3 years. Now <20%, working to increase presence.

Parts fuel-agnostic/transmission-agnostic. Don't depend much on fuel/transmission type, just dovetail design. Over time improved multi-utility presence. Well-placed for upcoming launches.

Volume growth ~13% in tonnage. RM inflation ~₹20-25 Cr in top line (~1.1-1.35%).

Supply all PCMs (passenger car), shock absorbers, consumer durables. Aerospace: supply exotic fasteners, powder metal aerospace applications in primitive stage but growing. Targeting ₹100 Cr+ aerospace this year (from ₹50 Cr prior), ₹500 Cr in 2-3 years.

With festivals and customer schedules, run rate should hold at this level.

IoT deployed across all plants (fasteners, assemblies). Established across all plants; benefits in data quality, machine downtime, quality levels. Productivity improvement 5-10%, margin impact 0.2-0.5%.

Specials: single-source with most OEMs. Standards: 30-40% overall presence, 50-60% share of business. New OEM entries (Hyundai/Kia via BIS/QCO imported earlier, now winning locally). Cummins fasteners also growing well. Targeting ₹100 Cr+ from Hyundai/Kia.

Passed NADCAP and AS9100. Work with HAL, ISRO, GE aviation, new customers like Skyroot. Customer addition increasing. Investing to equip division. Wind: expanded past year, now ₹30 Cr/month. New ₹100 Cr investment expansion will move ₹350 Cr annual to ₹500 Cr. Gross block moving to support.

Scanning for inorganic opportunities, especially in Europe. Look to buy assets with experience to shorten procurement (typical 12-18 month project expansion). Nothing in advanced pipeline. Even if there is, cannot tell.

Grown on all vehicle segments. M&HCV industry +20%, SFL matched. Heavy commercial, intermediate/light, small commercial, buses all growing. Passenger car post-GST rationalization up 23%, SFL matched. Tractor expected muted but +14-15%, SFL matched. Underperformance in 2W/3W (5-6% of pie, SFL not present). Wherever present, outperformed or matched.

Clarified: not EV underperformance, 2W underperformance. All platforms have EV presence; most revenue from export. Working with multiple players on India EV.

China economy strong (construction, CV), Sundram Fasteners China mirroring growth, ~20% growth FY27 vs FY26. UK tracks European truck market, aligned. Adding US business. TVS Upasana (2W) with Bajaj/RE/TVS growing. All subsidiaries together should have nice growth similar to SFL standalone.

EV is 4-5% of Sundram revenue. OEMs don't distinguish EV vs auto/M&HCV when placing schedules; no granular data available.

Credit agencies not talking such high numbers now. Holding high assessment from year-start. Confident activity levels and numbers robust. High base H2 effect may compress percentages. Hold prior % guidance; maybe calibrate later.

Should stay around these levels. Exports back to 30% share (long operating cycle). DSO actually down; temporary inventory spike due to supply/logistics. No balance sheet concern.

Press release on ₹400 Cr. Past 3 years ~₹400 Cr annual. 30% replacement, 70% growth. Inherent industry nature: continue to invest.

Q1 achieved 20.4% growth; exports growing (class 8 backlog 38-month high, North America EV recovery). Company reaffirming confidence despite macro headwinds.

Base <₹50 Cr FY26. Q1 on track per management. Both ICE/PHEV and EV platforms contracted. Initial projection ₹750 Cr peak mentioned.

From ₹50 Cr FY26. NADCAP/AS9100 certified; customers include HAL, ISRO, GE Aviation, new entrants. Capex backing investment.

₹100 Cr capex expansion under way; past year moved from ₹25 Cr to ₹30 Cr/month. Expansion timelines not explicit.

Q1 OPM 15.5% below target. Direct RM contractual pass-through; indirect cost (energy, chemicals) under negotiation. Expansion timing pushed to Q2 if negotiations conclude.

Contrast with prior 'stable margins' guidance suggests some upgrade, but Q1 delivery below 16.5% hope. Cost headwinds (West Asia, energy) real; pass-through incomplete.

Press release already issued. 30% replacement, 70% growth. Committed to ongoing annual capex, inherent industry nature. Funding from internal accruals or borrowings.

North American class 8 order backlog at 38-month high; backlog driven by construction, fleet replacement, EPA27 pre-buy. Cycle could reverse if construction/infrastructure demand weakens or pre-buy completes.

West Asia conflict driven energy cost inflation (LPG, chemicals) up; only partial pass-through (direct RM via contract, indirect via negotiation). If negotiations fail or stall, margins compressed indefinitely. Q1 OPM 15.5% already missed 16.5% hope.

Multiple high-value ramps (Hyundai/Kia targeting ₹100 Cr+ in 2-3 years, EV ₹200-250 Cr FY27, Garrett Motion growing). Any execution slip on tooling, quality, logistics delays revenue target achievement.

EV ₹200-250 Cr FY27 and potential ₹500-600 Cr by FY29 is from combined GM+Stellantis. If either customer cuts orders, stalls EV ramp, or shifts supply, material revenue miss. EV is 4-5% of total FY27 but growing fast.

CCC at ~150 days (vs prior 110-130 days). Export share 30% (vs prior lower) lengthens operating cycle. Inventory spiking; management says temporary due to supply/logistics, but could indicate demand uncertainty or over-stocking.