Sona BLW Precision Forgings Limited- Q2 Results

Introduction

Sona BLW Precision Forgings Ltd. (Sona Comstar) began as Sona Okegawa Precision Forgings, a joint venture between Sona Group and Mitsubishi Materials in 1995. The company was rechristened Sona BLW Precision Forgings Limited after acquiring Thyssen Krupp’s forging business and a 25% stake in Mitsubishi. Today, the company is a global powerhouse, with nine manufacturing and assembly units across countries like China and Mexico.

The auto component maker declared its quarterly results for Q2 of FY 2023-24 on October 25th and reported its highest-ever quarterly revenue. The key facts and figures are illustrated below.

Key Financial Metrics

Performance Highlights (Consolidated)

• Sona Comstar revealed a 34.1% YoY surge in net profit at ₹124 Cr for the period under review, compared to ₹92.55 Cr for the corresponding period last year.
• The adjusted PAT (before exceptional expenses) rose 39% to ₹128 Cr with a margin of 16.2%.
• The total revenue for the quarter increased 20.62% YoY to ₹787.4 Cr, from ₹652.9 Cr during Q2 FY 2022-23.
• The Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) margin improved by 300 bps YoY to 28.2% at ₹223 Cr, driving EBITDA growth of 35%.
• The company’s EV programs contributed 78% to the net order book* of ₹22,100 Cr until the end of the September quarter.

Sona BLW Precision Forgings Ltd. (Sona Comstar) announced its quarterly results for Q2 FY 2023-24 after the closing of market hours on October 25th. The auto component maker revealed that the company had generated its highest-ever revenue, EBITDA, and net profit during the period under review.

As per an exchange filing, Sona Comstar clocked a considerable increase in its battery electric vehicle (BEV) related revenue. The BEV segment accounted for 27% of its total revenue, with a revenue growth of 58% YoY.

The Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) margin improved by 300 bps YoY to 28.2% at ₹223 Cr, with a 35% YoY growth.

The company’s net profit (PAT) also surged 34.1% YoY and stood at ₹124 Cr, with a net profit margin of 15.7%. The adjusted PAT rose 39% YoY to ₹128 Cr, with a margin of 16.2%.

Over a six-month period (half-yearly), the company’s revenue grew 22% YoY to ₹1,518.85 Cr compared to ₹1,237.2 Cr during H1 of FY 2022-23. Its net profit (PAT) also registered a 40% YoY growth, standing at ₹236 Cr with a net profit margin of 15.5%.

Also Read: Sona BLW Precision Forgings Share Price

Management Commentary

Mr. Vivek Vikram Singh, MD and Group CEO, made the following announcements.

Major Announcements

• The previous quarter, Sona Comstar won a new program to supply the rotor-embedded differential sub-assemblies from a North American new-age OEM of high-end electric cars.
• The company also won a new program to supply traction motors for electric three-wheelers from one of the largest Indian OEMs.

Sona BLW Precision Forgings Limited: H1 Consolidated Financial Figures (YoY)

Particulars	H1 FY 2022-23	H1 FY 2023-24
Revenue from Operations	₹1,237.16 Cr	₹1,518.85 Cr
Total Income	₹1,250.47 Cr	₹1,534.44 Cr
Total Expenses	₹1,028.52 Cr	₹1,212.08 Cr
Profit Before Tax	₹221.95 Cr	₹313.64 Cr
Net Profit	₹168.4 Cr	₹236.1 Cr
Total Comprehensive Income	₹161.71 Cr	₹237.31 Cr

Sona BLW Precision Forgings Limited: Consolidated Financial Figures (QoQ)

Particulars	Q1 FY 2023-24	Q2 FY 2023-24
Revenue from Operations	₹731.2 Cr	₹787.5 Cr
Total Income	₹737.53 Cr	₹796.91 Cr
Total Expenses	₹585.2 Cr	₹626.9 Cr
Profit Before Tax	₹149.51 Cr	₹164.14 Cr
Net Profit	₹112.01 Cr	₹124.1 Cr
Total Comprehensive Income	₹116.15 Cr	₹121.16 Cr

Sona BLW Precision Forgings Limited: Consolidated Balance Sheet

Particulars	As of September 30, 2023
Total Non-Current Assets	₹2,165.15 Cr
Total Current Assets	₹1,346.4 Cr
Total Assets	₹3,511.55 Cr
Total Equity	₹2,492.7 Cr
Total Non-Current Liabilities	₹308.4 Cr
Total Current Liabilities	₹710.49 Cr
Total Liabilities	₹1,018.9 Cr
Total Equity and Liabilities	₹3,511.55 Cr

Stock Performance

Sona BLW Precision Forgings Limited declared its financial results for the second quarter of the fiscal year after the market closed on October 25th. The following day, the company’s shares opened at ₹527.75 and, riding on the company’s impressive performance, surged 6.69% to close at ₹547.05 apiece on the BSE.

About the Company

Sona BLW Precision Forgings Ltd. (Sona Comstar) is a leading automotive technology company with its headquarters located in Gurugram, Haryana. The company was established in 1995, and it has since become a major player with manufacturing and assembly units, R&D centres, and engineering capacity centres located across the United States, India, China, Serbia, and Mexico. Sona Comstar primarily focuses on designing, manufacturing, and supplying highly engineered, mission-critical automotive systems and components to automotive OEMs. The company is also the leading supplier to the fast-growing global EV market and relies on its strong R&D, engineering and technological capabilities to offer cutting-edge solutions.

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Sources:

https://www.bseindia.com/xml-data/corpfiling/AttachLive/2cd7fb56-4985-4c31-9d75-4939ab95af4b.pdf

https://sonacomstar.com/files/documents/press-release-for-q2-financial-document-FJ3gSX.pdf