Automotive Axles Limited , a key player in the commercial vehicle axle manufacturing sector, reported a 6% quarter-on-quarter decline in revenue for Q2 FY26, with total revenue standing at ₹470.00 crores. Despite the revenue dip, the company managed to improve its EBITDA margin to 12.40%, up from 11.70% in the previous quarter and 11.40% in the same period last year.

Financial Performance

The company's half-year revenue reached ₹969.00 crores, marking a 3% year-on-year decline. Despite the challenges, Automotive Axles demonstrated resilience in maintaining its profitability:

*Calculated based on the 6% quarter-on-quarter decline mentioned

Market Dynamics and Challenges

The revenue decline was attributed to several factors:

1. Product mix changes
2. Reduced tipper sales due to the monsoon season
3. Impact from tariffs on exports, particularly in the US market which is down 30-40%
4. Shift towards smaller configurations in tractor-trailers, resulting in fewer axles per vehicle

Despite these challenges, the Medium and Heavy Commercial Vehicle (MHCV) market performed reasonably well, with volumes around 95,000-98,000 vehicles for the quarter.

New Product Launches and Achievements

Automotive Axles continued to innovate and expand its product portfolio:

• Launched a 15-meter bus axle
• Introduced axles for electric vehicle applications, including 4x2 electric tractor trailer and 8x4 electric tipper
• Won a silver award from Ashok Leyland for aftermarket performance, achieving 98% delivery performance

Market Share and Customer Relations

The company maintains a strong position with key customers:

• 60-70% share of business with Ashok Leyland
• High double-digit share with Mahindra and Daimler

Future Outlook

Management expects Q3 and Q4 to end strongly, potentially better than last year, supported by GST revisions and domestic consumption. The company remains optimistic about market recovery and growth opportunities in the electric vehicle segment.

Management Changes

CFO Ranganathan S. announced his retirement effective November 21st after 11 years with the company, marking a significant transition in the company's leadership.

Investor Relations

During the earnings call, management emphasized their commitment to corporate governance and shareholder value creation. They assured investors that the recent acquisition of American Axle by Bharat Forge has no impact on Automotive Axles' operations or strategy.

As the commercial vehicle market continues to evolve, Automotive Axles appears well-positioned to navigate the challenges and capitalize on emerging opportunities in the sector.

Automotive Axles Limited has expressed optimism about its financial performance for the upcoming quarters. During a recent conference call with analysts and investors, the company shared projections indicating a robust finish to Q3 and Q5, with expectations to outperform the previous year's results.

Financial Outlook

The company's management provided insights into their anticipated performance during the conference call. While specific financial figures were not disclosed, the overall tone suggests a positive outlook for Automotive Axles in the near future.

Key Highlights

• Strong Q3 and Q5 Expectations: The company anticipates a strong performance in the third and fifth quarters of the fiscal year.
• Year-over-Year Improvement: Management expects to surpass the previous year's results, indicating potential growth in revenue and profitability.
• Investor Confidence: The positive projections shared during the conference call may boost investor confidence in the company's future prospects.

Industry Context

While the specific drivers of this anticipated growth were not detailed in the available information, it's worth noting that the automotive component industry in India has been showing signs of recovery post-pandemic. Automotive Axles' positive outlook could be indicative of broader sector trends or company-specific initiatives.

Investor Relations

Automotive Axles continues to maintain transparency with its investors, as evidenced by the recent analyst and investor conference call. The company has made the audio recording of the call available on its website, allowing shareholders and potential investors to access the detailed discussion about the company's financial performance and future outlook.

As the fiscal year progresses, market observers and investors will likely keep a close watch on Automotive Axles' performance to see if these optimistic projections materialize into concrete financial results. The company's ability to outperform its previous year's results in the coming quarters could be a significant indicator of its market position and operational efficiency in the competitive automotive components sector.

Note: Investors are advised to conduct their own research and consider market conditions before making investment decisions based on company projections.