Sandhar Technologies (SANDHAR) Q2 24/25 earnings summary

Executive summary

• Consolidated total income grew 11.5% quarter-over-quarter and 10.9% year-over-year in H1FY25, reaching ₹1,907 crores, with EBITDA up 22%-24% and PAT up 41%-55% YoY.

• EBITDA margin improved to 10.6% in Q2FY25 and 10.2% in H1FY25, with strong profitability and margin expansion.

• Joint ventures are performing well, with six out of seven PAT positive; overseas Romania plant expected to break even by year-end.

• New EV component facility commissioned in Haryana; commercial production of battery chargers started, with other EV products nearing mass production.

• Focus areas include ESG, SDG, product diversification, expanding customer base, and increasing content per car.

Financial highlights

• Revenue guidance for FY25 is INR 4,000-4,100 crores, with FY26 guidance at INR 4,500-4,600 crores.

• EBITDA margin guidance is 50 bps improvement per year, targeting 11-11.5% by FY26.

• Gross debt as of September is INR 620 crores (₹620 crores consolidated), net debt INR 581 crores; debt-equity ratio at 0.58.

• Cash flow generation in H1FY25 was INR 142 crores (₹142-163 crores consolidated), sufficient to fund expansion.

• EPS (not annualized) for Q2FY25 was ₹6.65 consolidated.

Outlook and guidance

• Confident of outperforming industry growth due to new business lines, capacity utilization (55%-82% in sheet metal), and new product launches.

• EV product lines (motor controllers, battery chargers, DC-DC converters) are in advanced readiness, with mass production scheduled between Dec 2024 and Apr 2025.

• FY26 growth expected to maintain a healthy premium over industry growth, supported by new capacities and orders.

• No plans for accelerated debt repayment; will follow normal schedule unless new opportunities arise.