NDR Auto Components Ltd
NSE:NDRAUTO
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Q2-2026 Earnings Call
AI Summary
Earnings Call on Nov 7, 2025
Strong Growth: NDR Auto Components reported Q2 FY '26 total income of INR 200.76 crores, up 14.35%, and H1 FY '26 income of INR 386.58 crores, up 11.19%.
Profitability: Q2 PAT rose 24.29% to INR 14.85 crores and EBITDA grew 20.77% to INR 22.58 crores, with margins expanding to 11.24%.
Product Portfolio Expansion: Two new technology license agreements were signed, targeting seatbelt reminder sensors and seat latches, each expected to add INR 30–40 crore revenue by decade end.
Demand Recovery: Management noted a strong uptick in demand since late September, supported by easing supply chain issues and a GST rate cut.
FY '30 Guidance Reaffirmed: The company maintained its FY '30 revenue guidance of INR 3,000 crores and 25% ROCE.
Order Book Growth: The current order book stands at INR 400–450 crores, with new orders from Maruti Suzuki and strong recovery in sunshade and KIA business lines.
NDR Auto Components delivered double-digit growth in both revenue and profit for Q2 and H1 FY '26, with Q2 income rising 14.35% and PAT growing by 24.29%. Margins improved year-over-year and management described the performance as steady despite earlier market slowdowns.
The company signed two new technology license agreements: one with Fujikura for seatbelt reminder sensors and another with Fischer Dynamics for seat latches. Both are expected to expand NDR's product offerings and contribute incremental revenue and margin benefits. Production is scheduled to start in 2027.
Management reported a recent and sustainable uptick in demand due to reduced supply chain issues and a GST cut. Improving consumer incomes and a shift toward higher-end vehicles were also highlighted as positive drivers.
NDR reaffirmed its FY '30 revenue target of INR 3,000 crores and a 25% ROCE, with management optimistic about growth opportunities. However, FY '26 incremental revenue is expected to fall short of earlier targets due to some model delays and underperformance, with some growth spilling into FY '27. H2 FY '26 is expected to be stronger than H1.
The order book has risen to INR 400–450 crores, including new models from Maruti Suzuki and recovery in KIA-related business. The ramp-up of sunshade deliveries and e-Vitara production are underway, with additional bidding activity for new projects.
EBITDA margins have improved, reaching 11.24% for Q2 FY '26. Management is actively working on further margin expansion, and expects slight improvement due to operating leverage as volumes grow in coming quarters.
Investments are being made in new facilities to support technology transfers and new orders, including new plants for KIA and upcoming products. The company is investing in both existing and new manufacturing footprints to execute on new orders and partnerships.
Ladies and gentlemen, good day, and welcome to the NDR Auto Components Limited Q2 and H1 FY '26 Earnings Conference Call. [Operator Instructions]
I now hand the conference over to Mr. Rishab Barar from CDR India. Thank you, and over to you, sir.
Good day, everyone, and a warm welcome to all of you participating in the Q2 and H1 FY '26 Earnings Conference Call of NDR Auto Components Limited. We have with us today on the call Mr. Pranav Relan, Whole-Time Director; Mr. Vikram Krishnan Rathi, CFO and Vice President; Mr. Rakesh Rustagi, GM, Finance and Accounts; and Mr. Rajat Bhandari, Executive Director and Company Secretary, along with other members of the senior management team.
Before we begin, I would like to mention that some statements made in today's discussion may be forward-looking in nature and are subject to risks and uncertainties. A statement in this regard is available in the Q2 and H1 FY '26 earnings presentation shared with you earlier. We will start this call with opening remarks from the management, following which we will have an interactive question-and-answer session.
I now request Mr. Pranav Relan to share some perspectives with you with regard to the operations and outlook for the business. Over to you, sir.
Good day, everyone, and a warm welcome to our Q2 FY '26 conference call. Let me start by quickly going through our financial performance for the quarter under review. Q2 FY '26 total income stood at INR 200.76 crores, a growth of 14.35%. EBITDA at INR 22.58 crores, a growth of 20.77%. EBITDA margins at 11.24% and PAT for Q2 FY '26 at INR 14.85 crores, which is higher by 24.29% as compared to the corresponding quarter last year. H1 FY '26 total income stood at INR 386.58 crores, a growth of 11.19%. EBITDA at INR 43.03 crores, a growth of 18.94%. EBITDA margins at 11.13% and PAT for H1 FY '26 at INR 28.44 crores, which is higher by 21.14% as compared to the corresponding period last year.
Our financial and operating performance has been steady in the backdrop of slow pickup for some of the models we cater to. These challenges and some supply chain bottlenecks have considerably eased and this combined with the reduction in the GST rate announced by the government gives us optimism and confidence for the remainder of the current year and going further forward. We have already seen a strong uptick in demand since the last week of September and believe this is sustainable. Improving disposable incomes and higher aspiration levels too are seeing upgrades by buyers to higher-end vehicles. This augurs well for the sector and for us in particular, given our emphasis on enhancing value and content per vehicle. Our Sunshade deliveries are back on track, and we also see an uptick on KIA offtake.
During the quarter under review, we entered into 2 technology license agreements or 2 TLAs that help us widen our product portfolio and introduce new and innovative offerings. This first TLA is for seatbelt reminder sensor agreement with Fujikura. Fujikura possesses years of experience developing seatbelt reminder systems for vehicles across Japan and other developed markets. The sensor technology is integrated into the seat design and has applications in both the front and rear seats. The total investment proposed by NDR Auto is INR 7.43 crores.
The second TLA is for physical seat latches for car seats, which is an agreement with Fischer Dynamics. Fischer Dynamics is an over 100-year-old entity, highly regarded for its innovation capabilities across design, engineering and manufacturing. The company's portfolio comprises a range of high-quality seat structures and mechanisms. Investment in this project is INR 17.43 crores. Seat latch is used to lock rare seats, which gives extra boot space and increases the area for luggage when required by the car owner. It is also a safety feature in case of accident, it protects the rare seats not to bend, thereby reducing the impact on passengers. [indiscernible] our excitement about our growth opportunities NDR Auto component enjoys. We maintain our outlook of INR 3,000 crores revenue in FY '30 and ROCE of 25%. We will now be happy to discuss any thoughts or questions you may have.
[Operator Instructions] The first question is from Jatin Chawla from RTL Investments.
First of all, congratulations on signing 2 new agreements on the technical assistance side. So the first question is on those 2. SBRS, what is the content per vehicle possible? And similarly for seat latches also, what is the content per vehicle possible? And what sort of vehicle categories do you see these products being used? Or are they going to be mandatory and being used in all models?
So seat latch, the content per vehicle is about INR 400 to INR 500, it is used in SUVs and hatchbacks. For seatbelt reminder sensor, the content is anywhere between INR 200 to INR 250 till up to INR 1,000, depending on the number of seatbelt reminder sensors used in the car. If there is one sensor used, then it's about INR 200. If it's used in the rare seatback, then it goes up to INR 1,000. And seatbelt reminded sensor is mandatory in the front 2 seats and the rare seatbelt regulation is yet to come.
Got it. And for NDR, will this show up as additional revenues? Or this is kind of we are in-sourcing -- we would have bought this component earlier, and we will be producing it now in-house and hence, will result in better margins for the company?
So this will result in additional revenue and better margins for the company.
So right now, you -- is it a bought-out component for us and...
It's not a bought-out component for us. We have added these products in our portfolio.
Okay. And with these investments of roughly INR 7.5 crores and INR 17.5 crores, so what sort of revenue potential do you see in these JVs in these entities, sorry?
So both should yield approximately INR 30 crores to INR 40 crores of revenue.
And you mentioned, I think in the last call, there were some worries about the market slowdown, but clearly, that trend has now reversed. And on a INR 700 crore base of FY '25, we were looking at INR 250 crores to INR 300 crores incremental revenue. But now with the market momentum coming back, what sort of revenue run rate are we looking at for FY '26? Do we think we can do an additional INR 250 crores or that is still looking difficult?
So with the GST cut, it's definitely been very beneficial to us. The Syros has obviously not done too well. But instead of Syros, we've got business for the [indiscernible] that is starting sometime in Q3. So we should recover some of it. The EBITDA has also started production, but we expect Q3 and Q4 to be better for that.
And this [indiscernible] business in 3Q itself. So this quarter, it started already?
It started in Q3, Q4 should be better.
The next question is from Saket Kapoor from Kapoor Company.
Congratulations on a very tidy set of numbers. Firstly, sir, in terms of the 2 JVs, which we have currently being signed, if you could just explain to us -- I think one is for the technology transfer and other is where we are putting up some facility. So if in detail, you can explain. And as you have mentioned about the incremental value addition per vehicle, how are we going to scale up this going ahead? And in how many models will this be replicated?
So both of them are technology transfer agreements, and we will be setting up facilities for them in our existing footprint. The seat latch will be made in our Pathredi plant and the seatbelt reminder sensor will be made in our Gujarat facility. And both should add about INR 30 crores to INR 40 crores of revenue each by the end of the decade.
Okay. What is the time line '27 is the time line to start...
So we start production in January 2027. And as new models come in, then we will start adding this in a car.
And sir, when we look at this auto component part, you were explaining to us. So currently, how is the sourcing arrangement there? And what exactly are we eyeing to do? And is it related to any stamping part? Or what exactly does this auto component you can define?
Sorry, I didn't understand your question.
Sir, you have mentioned about some JV with -- for the auto component thing also that we are coming up with our own manufacturing, which we earlier used to outsource. So if you could just explain to us what are those auto components that now we will be manufacturing?
I think this is NDR Auto South. It's a new plant that we're setting up for KIA, and it's the same product that we are doing.
Okay, sir. So earlier, we were outsourcing from some other players?
No, it's a new order that we've received from KIA, and we're setting up a facility for that in Anantpur.
Okay. And sir, going ahead, we are maintaining our revenue guidance of 25% for the ensuing year? And how will the margin shape up with the introduction of the new products?
Our FY '30 guidance for revenue is INR 3,000 crores. Our margin should be similar.
The next question is from Hitesh Goel from Aurigin Capital.
Can you tell us something about e-Vitara? I mean it's a major project, right? So has the production started? How is the ramp-up because that's you're targeting a big volume, right, in the second half?
So the production has started. The ramp-up is expected to be a bit more in quarter 4 and the year -- the following year.
So basically, when we were targeting 65,000 vehicles for exports from e-Vitara in 2H, that number holds or you think that will be slightly below and full ramp will come in a bit?
It will be slightly below than what we were expecting.
And also on KIA, can you give us some sense on the sunshade business and also you were in one of the vehicles, right, which has not done very well. So can you give us some sense about the revenue potential you were talking about in KIA?
So we've -- the one of the vehicles that we were on has not done well, but we've got a new order for the [indiscernible], which has already started production, which should help us a bit recover our volumes.
So this was -- you were -- you talked about INR 27 crores investment over 2 years in KIA in the last con call and 50,000 seat sets for 5-seater car and 70,000 for 7-seater car, right? So revenue potential was INR 100 crores from this order book. So any update on this?
So we've got business for the [indiscernible], which is an existing model that we've got, that has started production. On the last call, what we mentioned is for a new vehicle that is starting production sometime next year.
And in terms of market share on Maruti, the new vehicle -- sorry, Victoris, right? Are you present in that vehicle? And how is the market share?
We've got some BIW parts for the Victoris, so we don't have any seat and parts for the Victoris.
And this small car ramp-up, which Maruti is seeing after such a long time, that helps you, right? I mean you have a higher content high market share in the small cars.
Yes. So the Wagon-R and the Alto will help us.
And there, what is the share? You have 100% share in those vehicles?
No, 100% in the Wagon-R and 50% in the Alto.
Next question is from [ Saurabh Joglekar ] from Nirvana Capital.
So I'm new to the company. So a few basic questions. You recently onboarded KIA. So for what product exactly? And secondly, who was supplying them that product before you were onboarded as a vendor? And what is the onboarding process? How difficult is it to get onboarded?
So we do the seat covers for KIA. And in addition to that, we've also got businesses for the seat covers and the seed frames. There was an existing Korean company who is doing it. In terms of the processes, we were better in quality, cost and our delivery and our performance has been very good, which has led us to get additional business.
Understood. So on the seat frames and your traditional products, which accounts for, I think, more than 70% of your revenue. Currently, most of it is coming from Maruti, right? So is there any scope for new clients for that product? And currently, who is supplying to their competitors, like, for example, who is supplying to Tata, Mahindra? Or are they doing it in-house?
So we -- there is potential to supply to the other OEMs as well. Currently, the large multinational suppling to them.
Understood. So do you think you -- I mean, what does it take to compete with those large multinationals? And are you confident that you'll be able to do that?
So we're quite confident, give us some time, and we'll get back to you.
[Operator Instructions] Next question is from Jatin Chawla from RTL Investments.
A couple of follow-ups. So the KIA Carens order, how big is it?
It's about INR 20 crores to INR 25 crores.
Per annum?
Per annum.
And on the sunshade side, you said that things are coming back on track. So that statement is there in the presentation. So what exactly does it mean? Like are you back to that original INR 40 crore run rate? Or have you kind of received some more orders? What does the statement imply?
So we're getting close to the INR 40 crore number as the ramp-ups have happened. In terms of new orders, at the moment, we're bidding for new projects. And if it converts, then we'll let you know.
Got it. And what is our order book now?
So our current order book is about INR 400 crores to INR 450 crores.
Okay. And any new orders from the INR 350 crores order book that we shared last quarter?
Yes. So we've received one new model from Maruti Suzuki. In addition to that, we've got seat latches and seatbelts lined up.
Right. And this new model from Maruti, when is the start of production?
It's towards the end of 2027 or beginning 2028.
Okay. Got it. And this is a normal ICE vehicle, not an EV?
This is also an EV.
This is also an EV. Got it. On the Hayashi JV, I see now that the investment number is INR 80.5 crores. I think earlier, we were talking about INR 66 crores. So has the scope of the JV been expanded? Have we added some more products? What's leading to this? And I think the start of production also is a little bit earlier now compared to what we were saying earlier. So just an update on that would be useful.
So INR 66 crores was the equity, INR 80 crores is the total amount, including debt that we've taken. So we've received the first order for ambient lighting in 2027. So that is where we're starting production then. In terms of scaling up the JV, we are targeting the Toyota facility that is still under RFQ.
Got it. So I think your presentation says expected start of production April '26 for the JV. So that should be '27, right?
Yes. Let me double check and get back to you. Maybe it's an error, we'll change them.
[Operator Instructions] As there are no further questions, I'd like -- I'm sorry, there's one more question in queue. It's from Swapnil Gupta from White Pine Investment Management.
My question is relating to the BIW. So what is the current run rate? And apart from Jimny, have we got any other model for Maruti or any other OEM?
So we've got the Victoris set now. It's about INR 40 crores annual revenue. In addition to that, we are bidding for some new models. So once that shapes up, then we'll let you know.
Next question is from Jatin Chawla from RTL Investments.
Yes. Sorry, I forgot to ask the question on margins. Your margins have continued to expand. And this quarter, you're almost now even removing other income close to 10.9%, which is almost like 100 bps higher than last year. So where do we see margins going? Do we see further margin potential? Because I think every quarter, we are seeing margins gradually trend up?
So we're working on improving our margins every quarter when something -- you'll see the results, you see the numbers. I think that's the best way to look it.
Next 2 quarters, I think we are expecting that the revenue should also scale up with the e-Vitara coming in, BIW coming in. So there should be some operating leverage. So will the margins improve a bit further going forward?
They should slightly improve. They should improve.
[Operator Instructions] Next question is from Raj from [indiscernible] Partners.
Sir, in the earlier calls, you had said an incremental sales of around INR 250 crores to INR 300 crores for FY '26. So are we expecting that same in FY '26?
So we don't think we'll touch INR 250 crores, INR 300 crores because one model did not take off. And then in addition to that, one model got delayed, but maybe overall in FY '27, they should become better.
So this INR 250 crores to INR 300 crores sales should spill over to FY '27, right? And some bit of it will come in FY '26?
Some bit of it will come in FY '26. Some it will get spilled over to FY '27. One model did not pick up. If that picks up, then that will help us.
So sir, on an overall basis, how much growth are we expecting in FY '26 over FY '25?
So we don't want to give an annual guidance right now. We'll see how the market plays out, but the GST cut has definitely helped.
Okay. So are you confident that H2 FY '26 would be better than H2 '25?
Yes, H2 should be better than H1.
Previous H2?
Yes.
Next question is from Hitesh Goel from Aurigin Capital.
On your target for FY '30, you had said INR 3,000 crores in which we are talking about INR 1,000 crores from JV and INR 2,000 crores organically. So we understand that Toyota plant is coming in '28, '29. So that's a big boost. But can you tell us like -- I mean, if you look at other companies, big companies in the space, they give us some sense on the technology road map or kind of part they want to eventually get into. So it would be helpful if you can help us understand or give something in the PPT going forward that what are parts you are targeting on the seating system, which you don't currently make or importing, which can make margins or give additional revenue to get to this target?
Okay. Sure. We'll try to -- we'll share something with you. But usually, we don't like to talk about our strategy before it's finalized. So when it happens, then maybe it's better to share it.
Yes, yes. No, no. I'm just saying when it happens, you can -- so there is a -- if you look at Sona BLW, PPT, right? I mean, they give a sense of what all parts are there, right? And what all parts they're currently producing, what they are not currently producing. That gives us some sense on how companies can achieve a target and because auto industry growth is not more than 7%, 8%, right? So I mean, from that perspective, it's very useful to understand how company is looking at various parts, just a suggestion, yes.
Okay, sure.
[Operator Instructions] Next question is from Rahul Mishra from RTL Investments.
There was supposed to be this regulatory change on seating starting October 2025. Any update on that?
So there has been a small change in the small cars where they had to be compliant. So that is in place, and that will improve our content slightly.
How much -- any quantification possible?
A small improvement, nothing major.
[Operator Instructions] Well, as there are no further questions, I'd like to hand the conference back to the management team for closing comments.
Thank you for your time and participation. We continue to be optimistic about the opportunities before us and look forward to sharing these with you as we move forward. Should you need any input or clarification, please write into us or our Investor Relations partner, CDR India. Thank you.
Thank you very much. On behalf of NDR Auto Components Limited, that concludes the conference. Thank you for joining us. Ladies and gentlemen, you may now disconnect your lines.