Uno Minda Limited Q2 & H1 FY27 Earnings Conference Call Summary

Financial Performance Highlights

Q2 FY27 Financial Results:

  • Consolidated revenue from operations: ₹6,655 crores (38% YoY growth from ₹4,814 crores in Q2 FY26)
  • EBITDA: ₹733 crores (33% YoY growth)
  • EBITDA margin: 11%
  • Depreciation: ₹178 crores (increase of ₹5 crores YoY primarily due to capitalization of Kharkhoda alloy wheel facility)
  • Finance costs: ₹49 crores (increase of ₹4 crores YoY due to Kharkhoda plant capitalization)
  • Share of profit from associates and joint ventures: ₹60 crores (stable)
  • PAT attributable to shareholders: ₹420 crores (38% growth from ₹304 crores in Q2 FY26)

H1 FY27 Operational Metrics:

  • Cash flows from operations: ₹711 crores
  • Free cash flow after sustaining capex: ₹404 crores
  • Sustaining capex: ₹307 crores
  • Project capital expenditure: ₹500 crores
  • Net debt as of September 26, 2026: ₹2,415 crores (vs. ₹2,179 crores as on March 31, 2026)
  • Net debt to equity: 0.31
  • ROCE: 20.7% (24.6% if excluding non-deployed assets like land bank and CWIP)

Business Segment Performance

Switching Systems Vertical:

  • Revenue: ₹1,609 crores (37% YoY growth)
  • Contribution: 24% of group consolidated revenue
  • Two-wheeler switch business: Sustained growth from domestic volumes, favorable customer mix, and value-added features
  • Four-wheeler switch business (Uno Mindarika): ₹617 crores (over 30% YoY growth)
  • Export business: Maintained growth momentum reflecting international market acceptance
  • Manufacturing transition: Shifting Manesar operations to expanded Farrukhnagar facility expected completion in current fiscal year

Lighting System Vertical:

  • Revenue: ₹1,381 crores (25% YoY growth)
  • Contribution: 21% of group revenues
  • Growth led by two-wheeler lighting business with market share gains and EV penetration
  • Business development: Secured additional orders for advanced pixel-based headlamps and tail lamps from global OEM in PV segment

Casting Vertical (Fastest Growing):

  • Revenue: ₹1,441 crores (57% YoY growth, includes impact of higher raw material prices)
  • Four-wheel alloy wheel business: ₹763 crores supported by ramp-up of phase one (60K line) at Kharkhoda
  • Capacity enhancements: Bawal facility increased capacity by 20% through debottlenecking
  • Aggregate installed capacity: 6.3 million wheels per annum
  • Future capacity: To increase by over 40% to 9 million wheels per annum with ongoing expansions
  • Two-wheel alloy wheel business: ₹396 crores with new HPDC alloy wheel facility at Bawal (4 of 6 lines operational, adding 1 million units annual capacity)
  • Current installed capacity for two-wheeler alloy wheels: 9 million wheels per annum (to increase to 9.5 million with remaining lines, then to 11.8 million with Kharkhoda and Hosur expansions)
  • Aluminum die casting business: ₹282 crores (65% YoY growth) with capacity enhancement at Bawal and Hosur

Seating System Vertical:

  • Revenue: ₹476 crores (34% YoY growth)
  • Contribution: 7% of group revenues
  • Strong growth across customer base and increase in exports
  • Strategic wins: Entry into Japanese two-wheeler OEM and new bus passenger seat customer

Green Mobility Vertical:

  • Revenue: ₹649 crores (102% YoY growth)
  • Contribution: 10% of total consolidated revenues
  • Breakdown: Uno Minda EV Systems (₹247 crores), Alternate fuels (₹187 crores), Uno Minda Auto Innovations (₹156 crores), EV business in controller division (₹44 crores)
  • Growth driven by E2-wheeler and E3-wheeler segments with rising penetration and increased share of business
  • Future: Expected commissioning of three new programs for EV chargers in coming quarter

Other Product Portfolio:

  • Revenue: ₹1,099 crores (17% YoY growth)
  • Contribution: 17% of consolidated top line
  • Breakdown: Sensors and ADAS (₹261 crores), Acoustics (₹225 crores), Blow molding products (₹134 crores), Non-EV controller business (₹89 crores)

Capacity Expansion and Capital Expenditure

Recent Approvals:

  • Additional capex of ₹85 crores for sunroof facility at Bawal to serve incremental orders
  • Expected commissioning: Q2 FY28 (phase one expected by end of FY27)

August 2026 Board Approvals (₹1,415 crores total):

  • Greenfield aluminum die casting facility at Hosur: ₹510 crores
  • Extension/relocation of two-wheel alloy wheel capacity at Kharkhoda: ₹155 crores
  • Expansion of molding facility in Bengaluru: ₹80 crores
  • New manufacturing facility at CSN by TGSIN JV: ₹670 crores

TG JV Update:

  • Commissioned new manufacturing facility at Harohalli, Bengaluru
  • Profitability impacted due to capitalization (fixed costs, depreciation, and interest costs)

Market and Channel Performance

Aftermarket Business:

  • Revenue: ₹387 crores (6% of consolidated revenues)
  • OEM SPD division sales: ₹323 crores
  • Combined aftermarket and SPD channel: ₹709 crores (10% of consolidated revenues)

International Business:

  • Contribution: 9% of total revenues
  • Exports from India: ₹218 crores (vs. ₹123 crores in corresponding quarter)
  • Growth driven by two-wheeler switching and seating segments
  • Significant export orders won in seating business expected to drive future growth

Management Commentary and Outlook

Macroeconomic Environment:

  • Global GDP projected to slow to 3.1% for 2026 (IMF October 26 Outlook)
  • Global inflation revised upward to 4.7%
  • India GDP grew 7.8% in Q1 FY27, with IMF raising FY27 growth forecast to 7.0%
  • RBI revised growth projection to 7.1% from 6.7% earlier
  • RBI raised repo rate by 25 basis points to 5.5% to address inflation (projected at 5.2%)

Automotive Industry Trends:

  • Indian automotive production: 109 lakh units (18% YoY growth)
  • Domestic sales: 83.9 lakh units (18.2% YoY growth)
  • Vehicle exports: 20.8 lakh units (23.9% YoY growth)
  • Passenger vehicle production: 16.6 lakh units (25% YoY growth)
  • EV penetration: 8% for PVs (registrations doubled to ~1 lakh units)
  • Two-wheeler production: 81 lakh units (16.5% YoY growth)
  • Electric two-wheeler adoption: Registrations up 91% YoY to ~5.9 lakh units (11% penetration)

Strategic Priorities:

  • Focus on sustainable and profitable growth while outperforming industry growth
  • Market share gains, increasing content per vehicle, deeper penetration of value-added products
  • Localization of advanced technologies
  • Ongoing investments in manufacturing capacities, technology development, and R&D
  • Encouraged by growing opportunities in EV powertrain systems, advanced lighting, seating, sunroof, infotainment, and automotive electronics
  • 16 projects under ramp-up or execution providing multiple growth avenues

Q&A Session Highlights

Margin Guidance: Management maintains full-year EBITDA margin guidance of 11% ±50 bps, noting that commodity price changes are passed through to customers.

Inovance Business: Project under execution phase, expected commissioning by end of current fiscal year in Khed City.

Commodity Impact: Aluminum business commodity price impact estimated at ₹260-270 crores for the quarter.

Employee Costs: Reduced to 11.3% of sales benefiting from operating leverage with 38% top-line growth.

Depreciation: Controlled at 7% of gross block due to WDV method for continuous process plants.

ROCE Target: 18%-20% pre-tax in third full year of production for new projects.

Asset Turn: Expected between 1.8 to 2 initially on new capex, improving with incremental growth.