Uno Minda is an A /T+1 group Auto Components & Equipments industry company with having Face value of Rs. 2. Uno Minda (formerly Minda Industries Limited) the flagship company of the N.K. Minda Group is one of the most diversified auto component manufacturers in India. It is a technology leader in the auto components industry and a leading tier-1 supplier of proprietary automotive solutions to OEMs. Company has 10 R & D Centers globally and spends 2.5% of its revenue on R&D and it has currently 75+ R&D technology projects on hand. The Group is headquartered in Manesar, Haryana. It has engineering, research, and development centers in Manesar, Pune & Sonepat. It has 62 manufacturing plants across the globe including India, Indonesia, Vietnam, JVs/ Technical Agreements with technology leaders from Japan, Italy, and Taiwan. It has a partnership with 14 Global technology players. The Company manufactures 20+ Product categories for OEM’s which includes Alternate Fuel Systems; Air Filtration Systems; Canisters; Brake Hoses & Fuel Hoses; Combined Braking System (CBS); Noise Suppressor Cap etc. It’s Lighting division contributes 24% to its revenue followed by Switches: 35%, Acoustics: 10%, LMT: 15% and remaining 16% by other segments. It receives revenue generation of 48% from 2-Wheeler segment and 4-Wheeler contributes 52% of the revenue. Domestically it generates 83% of business and remaining 17% is generated by the company through its international business. Company has also strengthened its portfolio in Ev segment by offering different products for 2W and 3W such as Body Controller Module (BCM), On board charger, Battery management system, Battery pack, off – road charger, telematics and many other critical components.

Fundamentals (FY22-23):

Financial Results:

Company’s Net Sales was Rs 3,092.66 crore in June 2023 up 21.03%, Quarterly Net Profit at Rs. 172.75 crore in June 2023 up 24.47% and EBITDA stands at Rs. 337.87 crore in June 2023 up 22.62% as compared to June 2022. Company’s EPS has increased to Rs. 3.01 in June 2023 from Rs. 2.43 in June 2022.

Key Points:

1. Company has received incremental order of Rs. 470 Crores Annual Peak value from EV OEMs in Q1 of 2022 and it has also increased its Kit Value recently launched facelift models from OEMs.
2. The company has entered into JV with Buehler 50.1% stake held by Uno Minda for manufacturing of traction motors for 2W and 3W EVs. It has also entered into JV with Tachi-S with 51% stake held by Uno Minda for manufacturing recliners and other seating mechanisms in phased manner.
3. Company has also opened a New 4W Light manufacturing Facility with the total capex outlay of ₹ 400 Crores, a New 4W Switches Manufacturing Facility at Farukhnagar under the subsidiary, Mindarika Private. Limited at an initial outlay of ₹ 110 Crores and Expanded its existing 4W Alloy Wheel Capacity at a project cost of ₹ 190 Crores at Bawal Plant of Minda Kosei Aluminium Wheels Private Limited.
4. The company has entered into TLA with Asentec Korea to design, develop, manufacture and market high tech wheel speed sensors in India.
5. The company has also bagged incremental order with an annual peak value of approx ₹ 300 Crores comprising offboard charger, Motorcontrollers, BMS and DC-DC Converters and an incremental export order from American 2W OEM for switches and heated grips.
6. Company has recently completed the acquisition of remaining stake in Minda Kosei Aluminum (MKA), becomes a 100% subsidiary.
7. The Company has recently commissioned 30,000 expansion line for 4W Allow Wheel in Gujarat for expanding its capacity from 295,000 wheels per month to 325,000.
8. Company is the market leader in manufacturing of Alloy wheels in PV segment with a capacity of 1.3 lakh TPA of Die aluminium under 8 manufacturing units. It is India’s 3rd largest automotive lighting player with 12 manufacturing units backed by Taiwan R&D & Design Centre, Spain R&D Base for 2-wheeler, India and Germany R&D for 4-wheeler.
9. It is India’s No. 1 switch player diversified across the 2-wheeler, 3-Wheeler, 4-wheeler off-road and commercial vehicles with 11 manufacturing facilities.
10. It is also India’s No. 1 Seat manufacturing company for commercial vehicles, buses and 2W with 10 manufacturing facilities. It has recently Achieved highest ever exports from seating division of around 200 Crores in FY 23.

In last 3 Years the stock gave a return of 254.22% as compared to the rise of Sensex and Nifty in the same period.

Over the years company has made many key Acquisitions, Agreements and Joint Ventures under its different product portfolio which has enhanced its of offerings and even opened new segments for the company. Company’s key domestic clients include Bajaj, Honda Motorcycles, Hero Motocorp, Royal Enfield, Yamaha Motors, Piaggio and many more. Mutual Fund have also increased their holdings by 0.2% in the last quarter to 15.9% and Debt to Equity Ratio of 0.3 which is less than 1 and healthy. Considering company’s foray into EV segment with a wide range of offerings, good fundamentals, large order books and leadership in market under different product segments backed by Government’s push towards Electric vehicle transitions, investors may invest in this company for long term period.

- Het Zaveri

info@smartinvestment.in

(Disclosures: At the time of writing this article, author, his clients & dependent family members may have positions in the stocks mentioned above. The author, his firm, his clients or any of his dependent family members may make purchases or sale of the securities mentioned in website. Author may have positions in above stocks so have vested interest obviously in their going up or down as the case may be.

Disclaimer: Investing in any equity is risky. Our recommendations are based on reliable & authenticated sources believed to be true & correct, and also is technical analysis based on & conceived from charts. Investors should take their own decisions. We assume no responsibility for any transactions undertaken by them. The author won't be liable or responsible for any legal or financial losses made by anybody. Investors must take advice from their financial advisors before investing in any stocks.)