Sharda Motor Industries Ltd

Financial Performance

• Consolidated Q1 FY27 revenue INR 1,011.1 crores; YoY growth 34%
• Gross profit INR 203.9 crores; YoY growth 8%; impacted by supplier fire and premium RM procurement
• EBITDA INR 103.2 crores; YoY growth 5%; EBITDA margin 10.2%
• PBT before exceptional items INR 115 crores; after JV/associates
• PAT INR 86.5 crores

Operations and Growth Drivers

• Lightweighting focus: control arms and links ramp; Donghee tech license expands to subframe and torsion beams
• Exports: three orders from North American engine/genset maker; annual value ~US$10.7 mn; lifetime ~US$58.5 mn; SOPs across Q3–Q4 FY27
• Temperature-controlled tubes and emission adjacencies; RFQ pipeline across CV, agri and large genset segments
• Chakan 3 lightweighting facility SOP started; ramping per customer schedules
• Uttarakhand facility to invest ~INR 20 crores; co-locate with existing business; improve logistics and JIT
• R&D: 2 patents filed in Q1 FY27; total filings 24; 4 patents awarded
• Regulatory outlook: WLTP, BS7 under development; CAFE III adjustments; content mix shift towards lighter/engineered systems

Capex and Facilities

• Uttarakhand facility investment ~INR 20 crores; near customers in North India
• Chakan 3 facility SOP ongoing; modular capacity aligned to confirmed programs
• New capacity linked to validated programs; investment remains modular

R&D and Technology

• Patents: 2 additional filed in Q1 FY27; total filings 24; 4 awarded
• Donghee technology collaboration supports lightweighting portfolio expansion into subframe and torsion beams

Outlook and Guidance

• Outlook: FY27 growth driven by full-year lightweighting benefits, ramp-up of programs, temperature-controlled tube adjacencies, North American export SOPs, and domestic OEM volumes
• Exact quarterly trajectory depends on customer production schedules; disciplined capital allocation and ramp-ups

Q&A Highlights

• Export orders: SOPs on schedule; ramp-up tied to customer schedules; no fixed FY27/28 top-line guidance
• Gross profit dynamics: RM pass-through; substrate pricing by customers; premium RM costs absorbed; no quarter-specific lag
• Market share and competition: suspension share ~14% last year; expected to rise with SOPs; end-year update anticipated
• Purem JV: program started Q4 last year; ramping in FY27; integrated muffler opportunity market ~INR 60–100 crores
• BS6.3/WLTP/BS7: WLTP increases focus on catalysts and thermal management; BS7 not yet notified; CAFE III alignment under discussion
• Premium 2-wheeler emissions: domestic opportunities being explored; no immediate international expansion planned

Filing Status

• wrapper included: Transcript of Q1 FY27 earnings conference call for Aug 11, 2026
• no additional regulatory disclosures within this chunk

Meeting Details

• Date and time: August 11, 2026 at 05:00 P.M. IST.
• Type: Investors/Analyst conference call; mode not specified.
• Organizer: Sharda Motor Industries Ltd (SMIL).

Participants

• Key company participant: Asst. Company Secretary & Compliance Officer.

Purpose

• Discuss Q1 FY27 financial performance for quarter ended June 30, 2026.

Recording Availability

• Audio recording of the earning call provided; available on the company website.

Business Overview

• Core business: automotive components across Emission, Lightweighting, and Global verticals.
• 9 manufacturing facilities located in Chennai, Pune, Nashik, Sanand, Uttarakhand.
• Q1FY27 revenue ₹1,011 Cr; EBITDA ₹103 Cr; PAT ₹86.5 Cr.
• R&D centers in Chennai and Namyang (Korea); 125+ engineers.
• Patents: 24 filed, 4 granted in last four years.
• Strategic collaborations with Purem (Eberspächer) and licensing with Donghee.

Operational Highlights

• Emission vertical commands ~30% value market share for PV/LCV emission systems.
• Lightweighting vertical ~14% value market share for PV/LCV control arms and links in India.
• Donghee collaboration enhances lightweighting portfolio; signed for subframes and torsion beam.
• Backward-integrated manufacturing: tube mills, stamping, welding, testing capabilities.
• Exports focus: targeting Europe and USA; China +1 export expansion opportunities.

Financial Performance

• Q1FY27 revenue ₹1,011 Cr; YoY +34%; FY26 revenue ₹3,396.8 Cr; YoY +20%.
• EBITDA ₹103.2 Cr; EBITDA margin 10.2%; PAT ₹86.5 Cr; PAT margin 8.6%.
• Operating cash flow ₹362.9 Cr; net investing outflow ₹370.1 Cr; financing outflow ₹100 Cr.
• Total equity ₹1,313 Cr; cash ₹91.6 Cr; current liabilities ₹840.4 Cr.

Capital Structure & Liquidity

• Total equity (Mar-26): ₹1,313 Cr; Reserves ₹1,301.5 Cr.
• Current liabilities ₹840.4 Cr; cash and equivalents ₹91.6 Cr.
• Financing activities outflow ₹100 Cr; net cash decrease ₹107.2 Cr in the quarter.

Strategic Priorities & Outlook

• Scale Lightweighting; content per car target ₹6k–₹18k from ₹2k–₹8k.
• Enhance exports to Europe/USA; focus on CV emission components, tubes, heat shields.
• Pursue TA/JVs for localisation of powertrain-agnostic products; entry into adjacent exponential markets.
• Pursue selective domestic M&A in powertrain-agnostic products; capex funded by cash flows.

Governance & Leadership

• Chairman: Kishan Parikh; Independent Director: Dr. Sarita Dhuper.
• MD: Ajay Relan; Independent Directors: Udayan Banerjee; Navin Paul.
• Group CFO: G D Takkar; Company Secretary: Nitin Vishnoi.

Cost Auditor re-appointment

• Re-appointment of Gurdeep Singh & Associates as Cost Auditors for FY 2026-27, subject to member approval.
• Details provided in Annexure-B, per Regulation 30 and SEBI circulars.
• Firm profile: Gurdeep Singh & Associates is a 20+ year proprietary firm.
• Remuneration to be approved at the ensuing AGM.

Ajay Relan appointed Whole-time Director

• Appointed Ajay Relan as Whole-time Director for five years from 01-Sep-2026, subject to shareholder approval.
• Profile: over four decades in automotive components; led expansion and partnerships.
• Relation: Ajay Relan is father of Aashim Relan, CEO.
• Not debarred or disqualified by SEBI or authorities.
• Date and term: appointment effective September 1, 2026, for 5 years.

Dematerialisation confirmation

• Physical certificates received for dematerialisation have been mutilated and cancelled after verification.
• The depository's name has been substituted as registered owner in company records.
• The securities have been listed on the stock exchanges.

Q4 FY26 results

• Consolidated revenue rose 30% year-on-year to ₹971.8 crore.
• Gross profit increased 13% year-on-year to ₹216.1 crore.
• EBITDA rose 12% year-on-year to ₹112.9 crore; margin was 11.6%.
• PBT before exceptional items was ₹119.6 crore; PAT was ₹89.4 crore.

FY26 performance

• Full-year revenue grew 20% year-on-year to ₹3,396.8 crore.
• Full-year gross profit increased 8% year-on-year to ₹802.8 crore.
• Full-year EBITDA rose 6% year-on-year to ₹419.1 crore.
• PBT was ₹459 crore, including ₹22.41 crore exceptional gain and ₹4.26 crore exceptional loss.
• PAT for FY26 was ₹345.4 crore versus ₹314.9 crore last year.

Business drivers

• CV emissions contributed 44% of FY26 revenue; PV emissions contributed 43%.
• Lightweighting market share increased from 12.5% to about 14% in FY26.
• Lightweighting was about 10% of gross sales and is expected to rise in FY27-FY28.
• Export orders included a global agri OEM order worth about $2 million annually.
• A North American engine and genset order was delayed; SOP moved to Q3 FY27.
• Temperature-controlled tubes for a large off-highway manufacturer started SOP and are ramping up.
• FY27 capex guidance is ₹90-₹110 crore, excluding additional facility investments.

Q&A Highlights

• Analysts asked about underperformance versus industry; management said growth was broadly in line after excluding one customer.
• Analysts asked about new growth drivers; management said lightweighting, exports, and emission adjacencies will drive growth.
• Analysts asked about the largest PV customer opportunity; management said it is a long-term opportunity, not immediate.
• Analysts asked about export catalysts; management said announced export orders do not include catalyst components.
• Analysts asked about export margins and working capital; management said margins are higher, but net levels are broadly in line.
• Analysts asked about inventory rise; management said it reflected 30% revenue growth, with days improving.
• Analysts asked about TREM5; management said the opportunity is mainly mufflers and integrated mufflers in 19-37 kW tractors.
• Analysts asked about CAFE III; management said it supports emission systems and lightweighting, with ₹4,000-₹10,000 content increase per vehicle.
• Analysts asked about Donghee; management said it is a technology licensing agreement adding subframes and torsion beams.

Business

• Automotive components maker focused on emission systems, lightweighting, global business, and supply chain management.
• Serves passenger vehicles, commercial vehicles, tractors, construction equipment, and genset customers.

Operations

• Operates nine manufacturing facilities across Chennai, Pune, Nashik, Sanand, and Uttarakhand.
• Lightweighting vertical started SOP in FY26 and is ramping up from Q4 FY26.
• Global business targets exports in emission components, heat shields, and temperature-controlled tubes.

Financials

• Q4 FY26 revenue rose 30% YoY to ₹971.8 crore; FY26 revenue grew 20% to ₹3,396.8 crore.
• Q4 FY26 EBITDA increased 12% YoY to ₹112.9 crore; FY26 EBITDA rose 6% to ₹418.7 crore.
• Q4 FY26 PAT increased 7% YoY to ₹89.4 crore; FY26 PAT rose 10% to ₹345.4 crore.
• FY26 EBITDA margin was 12.3% versus 14.0% in FY25; PAT margin was 10.2% versus 11.1%.
• Operating cash flow was ₹362.9 crore in FY26; cash and equivalents ended at ₹91.6 crore.

Balance Sheet

• Total equity increased to ₹1,313.0 crore at March 2026 from ₹1,061.8 crore a year earlier.
• Trade payables rose to ₹774.6 crore, while receivables increased to ₹362.3 crore.
• Other investments increased sharply to ₹205.0 crore from ₹5.0 crore.

Strategy

• Management is scaling lightweighting content per vehicle and adding subframes and torsion beams.
• Export growth is supported by China-plus-one sourcing and tighter emission norms in Europe and the US.
• Company is pursuing technology alliances, localisation opportunities, and adjacent powertrain-agnostic products.

Risks

• Margin pressure came from lower gross margin and EBITDA margin versus FY25.
• Working capital remained elevated, with higher trade payables and receivables.
• Management highlighted geopolitical disruption and regulatory changes as both risks and opportunities.

Governance

• Board and leadership details were updated, including Group CEO, Group CFO, and executive director roles.
• No major board change or capital raise was disclosed in this chunk.