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Informist, Thursday, Jul. 23, 2026

By Anand JC and Shruti Nair 

MUMBAI – CIE Automotive India Ltd. wants to focus on adding and accelerating its projects to grow its financials at a faster rate, the company's executives told analysts at a post-earnings conference call Thursday. Multiple analysts thoroughly grilled the management on the company's underperformance in recent quarters, especially in comparison to their peers. 

The market demonstrated its disappointment with the company's performance in the June quarter as its shares traded 12% lower at INR 415.70 on the National Stock Exchange at 1354 IST. In response, the management said it was focused on profitability as well as return on investment. "We prioritise the return on investment and the reliability in the deliveries and in the quality rather than the fast growth with difficulties," the company's global chief executive officer, Ander Arenaza Alvarez, said.

"We can expect a certain slowdown in the second half of the year, because the market is very strong in this first half. But the demand from the customers and the expectations are good, and they continue chasing us for capacity," Alvarez said. 

Several investors expressed dissatisfaction and sought clarity on how the management expected the company and the industry to grow in the coming quarters. In response, the company said its growth rate has been around the weighted average market growth since the government slashed goods and services tax rates except for the June quarter. "We were in the range of plus-minus 2% (growth rate compared to the market), and I think it is the first quarter where we have fallen below that band," the company said. 

Assuaging the analysts' concern, Alvarez repeatedly stressed that the company was doing well and went on to say that sometimes excessive growth was "painful". "We are a good company, and we will continue growing for sure. The growth rate also depends on the structure and the people, engineering teams that you have," Alvarez said.

"Sometimes, excessive growth is painful for the company. That's why we try to keep our growth under control to avoid, let's say, growth difficulties as some of our competitors have," Alvarez said. "You can rely on us that we will continue with the growth around the market and our expectation is to be above that growth," he added.

Analysts expressed their disappointment over CIE Automotive's underperformance compared to the market and said that the company's earlier guidance for June quarter growth has been divergent from reality. "The restructuring of our business portfolio at our aluminium vertical, wherein we have let go of some loss-making products (has meant) we are below the market growth rate as far as two-wheelers are concerned," a top official said. "Exports have been a dampener for the second successive quarter. There was no growth in the exports income (in India market)," the official added. 

The automobile component maker had reported its earnings for the June quarter late Wednesday. CIE Automotive reported a consolidated profit of INR 2.36 billion on revenues of INR 26.21 billion.

CIE Automotive managed to grow its revenue 12-15% in the first two quarters of 2026, and wants to continue it over the next two quarters as well. 

OPERATIONAL VIEWS

The company's net financial debt as of Jun. 30 was INR 14.16 billion. "We have healthy liquid cash available and we are actively evaluating organic and inorganic growth opportunities," the company said. It incurred a capital expenditure of INR 2.1 billion in Jan-Jun, compared with INR 3.8 billion in 2025, with most of the growth capex focused towards the Indian market.

"India will be our growth market in the near future. Unfortunately, you saw that Europe is flat or even negative. The American market is also growing slightly in the next year," the company said, adding that the growth in the North America market is weaker than expected. "We will continue investing and developing the business here in India. That's the strategy. And we expect to succeed in the next years," the company said.

In the US, the company is ramping up a big programme for a top customer there. "This will give us around INR 2,000 million per year of new turnover that will fulfil our capacities in the foundry. We need to expand our foundry, we will build a new line," the company said. 

CIE Automotive manufactures gears and shafts, among other components. It is also a tier-1 supplier of stamped metal components and assemblies. The company launched a new production line for its stamping business, which it expects will start functioning by mid-2027.

In the iron casting business, the company said it has one big order and is expecting more. "I can tell you that in all the businesses, we have an expansion plan and we are working on that. We have our roadmap," a top official said. "I understand that some people are expecting higher growth, but we have our roadmap," he added.  End

Edited by Akul Nishant Akhoury

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