Sandhar Technologies – An emerging market leader

Sandhar Technologies ( very bullish commentary ) –

Q4 and FY 24 results and concall highlights –

Company’s product profile –

Automotive locking systems, Latches, Hinges and Door handles

Auto Vision Systems ( basically rear view mirrors )

Sheet metal components for 2W, 3W, PVs, CVs

Operator Cabins for OTR vehicles and CVs

Zinc dye-casting products for 2W, 3W, PVs and CVs

Aluminium dye – casting products for 2W, 3W, PVs and CVs

Magnesium dye – casting products – recently acquired a manufacturing facility for the same

Automotive Opto Electronic systems like – keyless entry systems, reverse parking assist systems etc

Polymer based products for 2W and 3W

Painting, plating and coatings

Fuel Pumps, filters and Wiper blades

Wheel rims and Handle bars for 2W

Q4 outcomes –

Sales – 918 vs 765 cr, up 19 pc
EBITDA – 98 vs 68 cr, up 35 pc ( margins @ 11 vs 9 pc )
PAT – 36 vs 25 cr, up 42 pc

FY 24 outcomes –

Sales – 3521 vs 2909 cr, up 21 pc
EBITDA – 341 vs 246 cr, up 34 pc (margins @ 10 vs 8 pc)
PAT – 110 vs 74 cr, up 45 pc

Company’s clients –

2W – Hero, TVS, RE, Honda, Ather, Suzuki, Mahindra

4W – Tata Motors, Mahindra, Honda, SML ISUZU

CV – JCB, Ashok Leyland, Volvo, Komatsu, Tata-Hitachi

Manufacturing facilities –

Company has manufacturing facilities located in –

Domestic – HP, Uttarakhand, Maharashtra, Gujarat, TN, Rajasthan, Karnataka

International – Poland, Romania, Spain, Mexico, South Korea, Japan, Taiwan

Product wise revenue split –

Locking and Vision systems – 25 pc
Cabins and fabrications – 15 pc
Sheet metal parts – 15 pc
Aluminium Dye Castings – 24 pc
Assemblies – 10 pc
Others – 10 pc

Segment wise revenue split –

2W – 58 pc
PV – 20 pc
Off-Highway vehicles – 15 pc
CVs – 2 pc
Others – 5 pc

New products line up –

EV Motor controller for 2W/3W – production to start in Jun 24

EV battery chargers for 2W/3W – production to start in Jul 24

DC – AC converter for 2W/3W – production to start in Oct 24

Company has done a lot of Capex in the last 2 yrs in its sheet metal parts and Dye – Casting divisions. This Capex can potentially add revenues of around 1500-1700 cr for the company without incurring any fresh capex. However, the company may still incur capex going fwd as it looks to add new components to its portfolio

Company should be able to grow its topline by 20 pc in FY 25 as well with a 50-100 bps margin expansion

Company has added Smart Locks to its product line up. Suzuki and Honda are moving onto these smart locks wef Oct and Nov 24. This should be a major Pivot for the company as the content per vehicle in these locking systems is far higher

Most of the growth in FY24 was led by Dye Casting and Sheet Metal segments

The value of Motor controllers that company is slated to begin to produce varies from Rs 4k-8k per vehicle

Company aspires to keep growing @ 15-20 pc CAGR ( revenues ) for next 3-5 yrs

Disc: planning to add, not SEBI registered, biased