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Informist, Monday, Oct. 26, 2026

 

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--Sona BLW: Demand for traction motors exceeded internal expectations Q2
--CONTEXT: Comments by Sona BLW mgmt in post-earnings analyst call
--Sona BLW: Co's EV ops more diversified now, across geographies
--Sona BLW: Many European auto cos want alternative to China for parts
--Sona BLW: EBITDA margin range of 23-25?ir for co
--Sona BLW: Facing genuinely exceptional inflation currently
--Sona BLW: Likely to hold current EBITDA margin unless oil prices rise more
--Sona BLW: Expect to have substantial cash balance at year-end
--Sona BLW:Have enough in pdt pipeline to help railway ops growth over 5 yrs
--Sona BLW: Evaluating using humanoid robots on co's shop floors

 

By Pratyush Kumar and Anand JC 

 

MUMBAI – Automotive component maker Sona BLW Precision Forgings Ltd. is evaluating whether to use humanoid robots in its production flows for repetitive tasks, its Managing Director and Group Chief Executive Officer Vivek Vikram Singh told analysts Monday in a post-earnings analyst call. "It (deploying humanoid robots on shop floors) has to make business sense, and it has to be a degree of return higher only then would we actually evaluate," Singh said, adding that this decision would be no different from evaluating using an industrial robot or human labour. 

 

The company may opt for using humanoid robots in tasks that are deemed unsafe for human beings or have low acceptability among human labour, Singh said. "Replacing humans just for the sake of it is not really anybody's target. In a country with a large population like India, that should also not be a target," he said.

Sona BLW posted strong growth in its top line for the September quarter, led by demand for its traction motor business, which exceeded the company's internal expectations. "The (traction motor) business has grown almost 50% quarter on quarter. That has obviously pulled down the overall margin percentage a little bit," the managing director said. The company identified that a strong demand for electric two- and three-wheelers was the biggest reason for growth in this segment. "This (electric two- and three-wheelers) is what drove a very sharp increase in traction motor sales," Singh further added.

Sona BLW Precision Forgings reported a consolidated net profit of INR 2.2 billion on revenues of INR 15.5 billion for the September quarter. Monday, shares of the company ended at INR 781.90 apiece on the National Stock Exchange, up nearly 4% from Friday.  

 

The company's revenue from battery electric vehicles has grown 40% sequentially on the back of sales to multiple geographies, the management said. "This demonstrates that our EV (electric vehicle) business is becoming more diversified and less dependent on any single customer or single geography," Singh said.

 

On being asked about competitive situation across European markets, Sona BLW is seeing more deal wins in Europe, the managing director said. The company is seeing high opportunity in this market as many original equipment manufacturers across Europe are looking for China-alternative automotive part suppliers. "That would be good for India overall but very good for Indian companies who can meet global quality standards and have their own IP (intellectual property) and design capabilities," Singh said.

 

The component maker guided that EBITDA margin in the range of 23-25% is "fair" for the company. "We are genuinely in exceptional inflation at this point. I mean, if you look around in the world, regardless of whether you are in manufacturing or not, just look around in your daily life, you realise how bad inflation really is," Singh said. 

 

The company's EBITDA margin range of 23-25% "makes sense", Rohit Nanda, group chief financial officer of the company, added. The top executive thinks the company should be able to hold on to this margin range on the back of its product mix. "Eventually, with the lag, the material prices will pass through to the customers," he added.

 

Sona BLW's EBITDA margin may contract only when the raw material costs continue to inch upwards, Nanda said. "That also seems improbable, because beyond a point, things start to break down," he added. "Unless oil goes to 150 ($150) (per barrel), when callbacks are off, we think we'll hold (EBITDA margin)," Vivek Vikram Singh added.  

 

 

The company expects to have substantial cash balance at the FY27-end, Singh said. The company is fairly selective about doing mergers and acquisitions, and has done only three in past decade, Singh said. "Just because everyone is doing it is not the reason we will do it, we will do it if it makes sense for the company. Capability is what we would look to acquire, not capacity, not customer, and 100% not because other people or everyone is doing it," he added.

 

The revenue share and sales volume from the company's traction motor business grew in the Jul-Sept quarter, and will continue to see this demand due to upcoming launches, Gupta said on being asked about the performance of the traction motor business. "Overall, it's a combination of market growth as well as the valid growth." The company also registered good demand for its two and three-wheeler component business, Gupta added.

The company has the capability, as well as the capacity, to ramp up production during high demand situations, it said. "Whenever OEMs (original equipment manufacturers) are challenged, whenever it's not business as usual, in fact, those times are the best times for us to gain wallet share," the company's motor business Chief Executive Officer Sat Mohan Gupta said. 

 

On a question about the company's growth outlook on railways business, given new product introduction within brakes, couplers, suspension, among others, the company said it has multiple products which have gone into serial production. "We have enough in product pipeline to support our growth over next five years", the company's railway business head Amit Mishra said. "It's (railway business growth) more dependent on whether we are successful to launch these products on time or not", he added. The company's orderbook for the railways business was INR 13 billion as on Sept. 30.  End

 

Edited by Deepshikha Bhardwaj

 

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