Sansera Engineering Limited

Sansera Engineering reported a strong Q4 FY25, with revenue from operations increasing 5% year-on-year to INR 7,817 million. Profit after tax (PAT) saw a significant 27% year-on-year growth, reaching INR 592 million, with a healthy PAT margin of 7.6%. For the full fiscal year 2025, the company crossed the INR 30,000 million mark in top-line, achieving INR 30,168 million, a 7% revenue growth year-on-year. FY25 PAT grew 16% year-on-year to INR 2,169 million, maintaining a 7.2% margin, marking the highest ever annual and quarterly performance.

The non-auto segment, particularly ADS (aerospace, defense, semiconductor), showed robust growth, with ADS revenues reaching INR 1,235 million in FY25 (13% YoY growth) and surging 43% YoY in Q4 FY25 to INR 434 million. The xEV and Tech-agnostic segments collectively contributed close to 15% of total revenue in FY25, growing 28.6% YoY. The traditional ICE automotive components business saw its share of overall revenue fall to 73.6% in FY25 from 75.4% in FY24, reflecting successful diversification efforts. Two-wheeler, Passenger Vehicle, and Commercial Vehicle segments contributed approximately 44%, 18.6%, and 10.5% respectively to the ICE pie.

As of March 2025, Sansera's order book stood at INR 18,511 million, with over 60% comprising international orders and 28% from the ADS segment. Management expects new orders to contribute an additional INR 5,000 crores in revenue by FY28 or FY29. The company anticipates that the annual peak revenue from new orders will be realized by the third year, with a large portion of the current order book maturing by FY27.

The company spent INR 5,911 million on capex in FY25. Strategic investments included INR 100 crores for a 55-acre land acquisition in Karnataka for future expansion (construction planned for FY27) and INR 35 crores for a facility in Pantnagar, expected to be operational by Q2 FY26. Brownfield expansion at the Bidadi plant also occurred. For the current year, approximately INR 350 crores of capex is planned for the group, including ADS. The ADS facility is expected to have a gross block of INR 300 crores and generate INR 600-650 crores in revenue, aiming for an asset turn of two, while overall asset turns are targeted at 1.35 to 1.4.

Sansera significantly reduced its debt, leading to a decrease in finance cost from INR 225 million to INR 96 million in Q4 FY25. The remaining long-term debt is approximately INR 200 crores in the main company and INR 100 crores in subsidiaries. The company generated healthy operating cash flow of INR 3,766 million (net of taxes) for FY25, which is deemed sufficient to fund planned capex without requiring further debt. Net cash amounted to INR 125 crores at year-end, boosted by QIP proceeds.

The strategic investment in MMRFIC, made a couple of years ago, is progressing as expected. Sansera holds approximately 30% stake, having invested around INR 30 crores. MMRFIC focuses on developing technologies for aerospace, defense, and semiconductor sectors, receiving government orders and grants. In FY25, MMRFIC generated approximately INR 20 crores in revenue with about 40% EBITDA, with expectations for higher EBITDA margins once mass production commences by FY27.

The export business faced headwinds in Q4 FY25, primarily due to global tariff-related uncertainties, which caused OEMs to be cautious, reduce inventories, and delay new order placements. This impact is expected to continue into Q1 FY26. While some orders have duties paid by Sansera, most export orders have duties paid by customers. The company is in discussions with customers to offset duties where applicable and remains optimistic about long-term tailwinds for the Indian component manufacturing industry.