Sundram Fasteners , a leading auto component manufacturer, has reported its highest-ever half-year profit after tax of Rs 278.00 crores on revenue of Rs 2,723.00 crores for the first half of FY 2026. The company's strong performance was primarily driven by robust growth in the domestic market, despite moderation in exports.

Domestic Growth and Export Moderation

The company witnessed a 12% growth in its domestic segment during the quarter. However, exports moderated to Rs 338.00 crores from Rs 389.00 crores in the corresponding quarter of the previous year. The domestic business mix comprises 58% OE (Original Equipment), 12-13% aftermarket, and 26-27% exports.

Financial Highlights

The company's EBITDA stood at 18.00% for the quarter, with quarterly profit reaching a record Rs 140.00 crores. For the half-year, EBITDA margin improved to 17.70% compared to 17.20% in the corresponding period last year.

Factors Contributing to Performance

1. Currency Depreciation: The company benefited from rupee depreciation, with the USD-INR rate moving from Rs 85.40 to Rs 88.40 during the period.

2. Raw Material Prices: Softening of raw material prices, particularly in boron steel and alloy steel, led to gross margins exceeding 60%.

3. Product Mix and Cost Control: Better product mix and control over stores and tools expenses contributed to improved margins.

4. Wind Energy Segment: The wind energy segment showed 30-35% growth and now contributes 4% of domestic sales.

Segment-wise Performance

• Commercial Vehicles: Growth primarily came from light and medium commercial vehicles, while the heavy commercial vehicle segment remained muted.
• Passenger Vehicles: The company gained market share in this segment, particularly with new business acquisitions.
• Tractors: Strong performance in the tractor segment, where Sundram Fasteners has an 80-90% market share with existing customers.
• Non-Auto Segment: Currently at 37% of overall revenue, including tractors, wind energy fasteners, and aerospace fasteners.

Future Outlook

Management expects recovery in export markets within 6 months, with customers indicating preparation for ramp-up in upcoming quarters. The company is targeting a double-digit CAGR growth going forward.

Mr. R. Dilip Kumar, Chief Financial Officer of Sundram Fasteners, commented, "We are pleased with our performance in the domestic market and are optimistic about the recovery in our export markets. Our diversified presence and ongoing customer engagements position us well for future growth."

The company continues to focus on expanding its non-auto segment, particularly in wind energy fasteners and aerospace applications. With the domestic outlook remaining strong and potential export revival in Q4 and Q1 of the next fiscal year, Sundram Fasteners is poised for continued growth in the coming quarters.

Electric Vehicle (EV) Segment

While some EV programs from major customers are being deferred due to market conditions, Sundram Fasteners remains prepared for future growth in this segment. Currently, EV-related revenue contributes about 5-6% to the company's total revenue, with potential for growth as more dedicated EV platforms are developed.

As the auto component industry navigates through changing market dynamics and technological shifts, Sundram Fasteners' strong performance and strategic positioning in both traditional and emerging segments underscore its resilience and growth potential in the evolving automotive landscape.

Sundram Fasteners , a leading automotive component manufacturer, has recently unveiled plans for a new global ice engine program and shared an optimistic outlook for the coming months. This announcement comes as part of the company's strategy to capitalize on strong domestic industry conditions and potential export recovery.

New Global Engine Program

Sundram Fasteners has revealed a new global ice engine program scheduled to launch between 2029 and 2031. This long-term initiative demonstrates the company's commitment to innovation and its ability to secure future business in the evolving automotive industry.

Improved Order Schedules and Growth Outlook

The company anticipates improved order schedules for the upcoming quarter (Q4) and the following Q1. Management has expressed a positive outlook for the next six months, driven by:

1. Strong domestic industry conditions
2. Potential recovery in exports
3. Increased orders expected from customers in Q1 and Q2

Product Innovation and Revenue Diversification

Sundram Fasteners has shown a strong focus on product innovation:

This emphasis on new product development showcases the company's adaptability and commitment to staying competitive in the market.

Wind Energy Business

The company's wind energy segment has been performing well:

The strong performance of the wind energy business, particularly in terms of return on capital employed, highlights Sundram Fasteners' successful diversification strategy.

Focus Areas and Growth Targets

Sundram Fasteners is concentrating on specific product areas to drive growth:

1. Stainless steel fasteners
2. Railway fasteners

The company expects revenue growth in these segments in the coming year. Management aims for double-digit annual growth.

Export Recovery

While the company has been facing challenges in the export market, management is optimistic about a recovery:

• Anticipated timeframe for export recovery: Within 6 months
• Customers are planning increased orders for Q1 and Q2

This expected recovery in exports could provide a significant boost to the company's overall performance in the near future.

Conclusion

Sundram Fasteners' announcement of a new global engine program, coupled with its focus on product innovation and diversification, positions the company well for future growth. The positive outlook for both domestic and export markets, along with the strong performance of its wind energy business, suggests that the company is on track to achieve its growth targets. Investors and market watchers will be keen to see how these initiatives translate into financial performance in the coming quarters.