Talbros Automotive Components Limited

Talbros Automotive Components Limited announced a new joint venture with Lohum Cleantech Private Limited. This strategic partnership aims to develop recovered carbon black and devulcanized rubber, aligning with Talbros' vision for sustainable and technology-led growth. The JV is projected to generate INR 500-600 crores in revenue over the next five years with healthy EBITDA margins of 15-18%. It will leverage Talbros' OEM relationships and Lohum's advanced technology, with a planned capex of INR 70 crores over two years, funded by 40% equity and 60% debt.

For H1 FY26, Talbros reported a revenue of INR 427 crores and an EBITDA of INR 70 crores, resulting in a 16.5% EBITDA margin. PAT for H1 FY26 stood at INR 45 crores, a 3% growth compared to the previous year. In Q2 FY26, the company achieved a revenue of INR 217 crores and an EBITDA of INR 36 crores, with a 16.4% margin. Q2 PAT remained flat at INR 23 crores, primarily due to increased employee costs.

The Gasket division's sales remained flat at INR 143 crores in Q2 FY26 and INR 278 crores in H1 FY26. The Forging division also saw flat revenue at INR 76 crores in Q2 and INR 151 crores in H1, significantly impacted by a cyberattack on a key European client. In contrast, Marelli Chassis Systems Private Limited demonstrated strong growth, with Q2 revenue increasing 18% to INR 79 crores and H1 EBITDA growing 37% to INR 28 crores. Talbros Marugo Rubber reported Q2 revenue of INR 35 crores and H1 revenue of INR 65 crores, though its H1 EBITDA declined by 8% to INR 8 crores.

Q2 FY26 was affected by several external factors, including a cyberattack on a major European client (JLR), which caused a one-time^📎 business loss of INR 10 crores and a INR 5-7 crores loss in the Forging segment. Muted demand in Europe, a drop in BMW EV sales, and an initial slowdown due to the GST 2 rollout also impacted performance. However, volumes rebounded sharply with the festive season, and management expects a strong H2 FY26, projecting full-year FY26 revenue growth to reach 10% from H1's 2%.

Talbros secured several new orders expected to commence production in early 2026, including heat shields for Kia (INR 13-15 crores p.a.), business from Kamaz (INR 10 crores p.a.), Tata Cummins gasket business (INR 10 crores p.a.), and new Mercedes orders (INR 20 crores p.a. peak volume). A substantial Stellantis order of INR 100-150 crores p.a. is also slated to begin in January. Exports, which constituted 26% of H1 revenue, are targeted to grow to 35% by FY27, with an anticipated recovery to 28-29% in Q3/H2 FY26.

The company outlined its capital expenditure plans, with approximately INR 50 crores allocated for the Gasket and Forging divisions and INR 8 crores for the Marugo business in the current fiscal year. An additional INR 60 crores has already been spent in the Marelli business. Furthermore, the new Lohum JV will require INR 70 crores in capex over the next two years, indicating continued investment in capacity expansion and new ventures.