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    SJS Enterprises

    SJSGood
    Automobile and Auto Components·5 Feb 2025
    Management Summary

    SJS Enterprises delivered a strong Q3 FY25, outperforming industry growth in the automotive segment, particularly passenger vehicles. The company reported robust revenue and profit growth, driven by strategic initiatives and operational efficiencies. Management highlighted significant new business wins, capacity expansion plans, and a positive outlook for exports and new product segments like cover glass, despite some short-term softness in export markets.

    Highlights

    8

    • Consolidated revenue grew 11.2% Y-o-Y to INR 1,785.6 million in Q3 FY25.

    • EBITDA increased 16.9% Y-o-Y to INR 482 million, with margins at 26.6% (up 102 bps Y-o-Y).

    • PAT grew 32.9% Y-o-Y to INR 277.1 million, with margins at 15.5% (up 253 bps Y-o-Y).

    • Automotive business grew 15.4% Y-o-Y, outperforming the industry growth of 7.1%.

    • Passenger vehicle business saw a strong 22.6% Y-o-Y growth.

    • Exports for 9 months FY25 grew 20.3% Y-o-Y to INR 421.6 million.

    • Walter Pack India products contributed 27% to consolidated revenue in Q3 FY25.

    • Strong operational cash flows of INR 1,263.1 million and free cash flow of INR 1,003 million for 9 months FY25.

    What Changed1

    vs Q4 FY25

    Guidance items19 → 10 (-9)

    Key financials

    Single quarter

    07 metrics
    1. 01Consolidated Revenue1,785.6 Mn+11.2%YoY
    2. 02EBITDA482 Mn+16.9%YoY
    3. 03EBITDA Margin26.6%
    4. 04PAT277.1 Mn+32.9%YoY
    5. 05PAT Margin15.5%

    Segment breakdown

    Automotive Business
    15.4% Y-o-Y Growth
    Domestic Sales
    12.3% Y-o-Y Growth
    Passenger Vehicle Business
    22.6% Y-o-Y Growth
    Exports (Q3 FY25)
    115 Mn Value6.4% Share of Consolidated Sales0% Y-o-Y Growth
    Exports (9 Months FY25)
    421.6 Mn Value20.3% Y-o-Y Growth7.5% Share of Total Revenue
    Walter Pack India Products
    27% Share of Consolidated Revenue
    Exotech (9 Months FY25)
    25.5% Y-o-Y Growth
    Walter Pack (9 Months FY25)
    20.5% Y-o-Y Growth
    2-Wheeler Sales (Q3 FY25)
    8.4% Y-o-Y Growth
    List

    Guidance & targets

    10
    CategoryTargetPriority
    Capex
    Chrome Plating and Painting Capacity Expansion
    INR 100 crores
    		High
    Capex
    Cover Glass Facility Development
    INR 40 crores
    		High
    Exports
    Share of Consolidated Sales
    14% to 15%
    		High
    Capacity
    Cover Glass Plant Readiness
    September, October
    		High
    Capacity
    Cover Glass Plant Stream Start
    end of FY26
    		High
    Order Fulfillment
    Stellantis Supply Start
    July next year
    		High
    Order Fulfillment
    Whirlpool Dishwasher Plant Supply Start
    immediately / next quarter
    		High
    Asset Turnover
    Cover Glass Asset Turnover
    2.5 to 3 times
    		Medium
    Market Penetration
    IME Penetration Increase in India
    increase
    		Medium
    Integration
    Walter Pack Integration Completion
    clear
    		Medium

    Risks & concerns

    4
    RiskSeverity

    Soft market conditions and political uncertainties in Europe and North America impacting exports

    Sales have been lower in exports primarily because of soft market conditions in Europe and North America and political uncertainties. — Management acknowledged

    medium

    Q3 being a cyclically lower quarter due to new model changes and plant shutdowns

    Q3 is typically a lower sales quarter due to new model changes and plant shutdowns, especially in export markets. — Management acknowledged

    low

    Lower-than-expected volumes from Tata Motors for Walter Pack products

    The volume that Tata Motors has not been as well as they promised, leading to a 'lull for the moment' for Walter Pack. — Management acknowledged

    medium

    Areas of Evasion(1)

    • specific financial details of new orders (e.g., Whirlpool order quantum/run rate)

    Q&A highlights

    3

    “But the important point, I would like to add to what Mahendra just said, quarter-to-quarter, depending on the model mix, depending on the offtake of the customer, as I said, demand, because of supply float in the market, was lower in some cases. But the important operating number you should look at is the 9-month number for these companies. So Walter Pack has grown very strongly, close to about 20.5% and Exotech has grown at about 25%, 26%.”

    Analyst questioned negative Q-o-Q growth for key acquired/growth segments; management clarified by emphasizing strong 9-month Y-o-Y growth and Q3 seasonality.

    asked by Ajox Frederick

    2 min read6 chapters

    Detailed Narrative

    01

    Q3 FY25 Financial Performance Highlights

    SJS Enterprises reported a strong Q3 FY25, with consolidated revenue growing 11.2% Y-o-Y to INR 1,785.6 million. EBITDA increased by 16.9% Y-o-Y to INR 482 million, expanding margins by 102 bps to 26.6%. Net Profit (PAT) saw a significant 32.9% Y-o-Y growth, reaching INR 277.1 million, with PAT margins improving by 253 bps to 15.5%. The company also highlighted robust cash flow generation, with 9-month FY25 operational cash flows at INR 1,263.1 million and free cash flow at INR 1,003 million.

    02

    Automotive Segment Outperformance and Growth Drivers

    The automotive business demonstrated strong momentum, growing 15.4% Y-o-Y, significantly surpassing the industry's 7.1% production volume growth. This was primarily driven by the passenger vehicle (PV) segment, which grew 22.6% Y-o-Y. Key wins with customers like Mahindra (for their new EV range) and supplies to Maruti Suzuki for the new Dzire contributed to this outperformance. Domestic sales overall grew 12.3% Y-o-Y.

    03

    Export Strategy and New Business Wins

    Exports remain a key focus, with a target to increase their share of consolidated sales to 14-15% by FY28. For 9 months FY25, exports grew 20.3% Y-o-Y to INR 421.6 million. The company secured large global orders from Stellantis (an 8-year program starting July 2025) and Whirlpool (sole supplier for a North American dishwasher plant starting Q4 FY25). While Q3 FY25 exports were flat Y-o-Y at INR 115 million due to soft market conditions in Europe and North America, management is optimistic about future growth from these new wins.

    04

    Capacity Expansion and New Product Development (Cover Glass)

    SJS is investing significantly in capacity expansion, with INR 100 crores allocated for chrome plating and painting in Pune and INR 40 crores for a new cover glass manufacturing facility in Hosur. The cover glass plant is expected to be ready by September/October 2025 and operational by the end of FY26. Management views cover glass as a high-potential segment, currently imported into India, and expects an asset turnover of 2.5 to 3 times at peak levels, leveraging their 35+ years of printing expertise.

    05

    Walter Pack India Integration and Performance

    Walter Pack India products contributed 27% to the consolidated revenue in Q3 FY25. For the 9 months FY25, Walter Pack grew strongly at 20.5% Y-o-Y. The integration of Walter Pack into SJS is ongoing and is expected to be completed by the end of FY25. New customer acquisitions for Walter Pack, including Mahindra and Volkswagen, are expected to drive future growth, balancing out lower-than-expected volumes from Tata Motors.

    06

    In-Moulded Electronics (IME) and Premiumization

    Premiumization remains a key growth driver, with the company actively developing In-Moulded Electronics (IME) parts. Prototypes have been provided to OEMs, and management anticipates IME penetration to increase in India over the next 2 to 3 years. This aligns with the trend of larger displays and advanced aesthetic and functional products in the automotive and consumer durable segments.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.