Ladies and gentlemen, good day and welcome to CIE India Q3 and NM CY2024 conference call hosted by ICICI Securities. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Vishakha from ICICI Securities. Thank you, and over to you, Ma'am.
Thanks, Nivedita. Good afternoon, everyone. Thanks to CIE Automotive India Limited management for giving us the opportunity to host the call. We have here on the call the senior management represented by Mr. Ander Arenaza Álvarez, CEO, Mr. K. Jayaprakash, CFO, Mr. Vikas Sinha, Senior VP, Strategy, Mr. Rohit Lakhanpal, Business Controller, and Mr. Swapnil Soudagar, DGM, Strategy. Over to the management to take this ahead. Thank you.
Yeah. Thanks, Vishakha. This is Vikas. I welcome all of you on this call, and also Ander, our CEO. We will go through the Q3 C2024 results of CIE Automotive India Limited. First up on page five, we have an overview of the simplified holding structure of CIE India and its subsidiaries. Please do have a look. We now start with results of the India operations for Q3 C2024 on page seven. Sales were INR 14,707 million, EBITDA INR 2,606 million, EBIT INR 2,032 million and EBT INR 1,997 million. The sales grew 2.2% year-on-year, EBITDA 8%, EBIT 9% and EBT 14%. EBITDA margin in Q3 C2024 is at 17.7% compared to 16.7% in Q3 C2023 and 18.1% in Q2 C2024. The year-on-year sales growth of 2.2% was same as the weighted average market growth across the market segments we operate in. There are some mitigating factors to consider.
The light vehicle market has shown a decline in this quarter, a very slight decline in this quarter as compared to the same period last year. Tractor markets remained largely flat at a 3% growth over last year. The two-wheeler market has grown well on the back of festive demand. The delay in the ramp-up of some of our orders has unfortunately continued, and this has impacted sales growth, but that should be corrected in the coming quarters. We have postponed that a little bit. Nevertheless, we are happy to note that EBT grew by a healthy 14% in spite of the anemic growth this quarter. We will continue to focus on operational improvement, which is shown by the margin trends despite the weak market environment. Overall, we have positive expectations on growth and margins from all our verticals in India.
The market situation in India is, we are cautiously optimistic about it, with mixed growth trajectories in the different segments. The trend of growth in the two-wheeler segment should continue, and the festive season is expected to give a boost to this segment. Tractors will continue to be steady on a high base with rural income showing recovery. The light vehicle market, though, will see a steady growth of around 5%, unlike the heavy growth seen over the last few quarters. Now we move to the results of our European operations for Q3 C2024 on page eight. Sales fell to INR 5,899 million from INR 7,262 million in Q3 C2023 and is a combination of the drop in the European light vehicle market and the extended slowdown in the U.S. off-highway market affecting Metalcastelo that we have been talking about since the last few quarters.
The drop in sales sequentially between Q3 C2024 and Q2 C2024 was 22%, which is similar to the drop in the light vehicle market, which fell by 19% and added to by the U.S. off-highway market drop. The Q3 C2024 EBITDA in Europe was INR 942 million, EBIT INR 719 million and EBT INR 602 million. EBITDA margin in Q3 C2024 was 16.0% compared to 17.2% in Q3 C2023 and 17.0% in Q2 C2024, which shows that despite the sales drop, the corrective measures that we had started taking in the previous quarter has helped us protect our margins somewhat. The market situation in the coming quarters remains uncertain with the uncertainty in the light vehicle market continuing. The EV penetration in the European auto sales has also been stagnating around 12%-14% and will continue to be at the same level given the uncertainty around the evolution of the technology.
Our attempt will be to be in step with the market while maintaining our margins. Now if you go to page nine, we'll see the consolidated results for Q3 C2024. Sales were INR 20,606 million, EBITDA INR 3,548 million, EBIT INR 2,750 million and EBT INR 2,600 million. Despite the European sales drop, the consolidated EBITDA margin for the quarter was 17.2% versus 16.9% in Q3 C2023. While sales dropped by 5%, EBITDA dropped by 3%, EBIT by 4%. However, EBT grew by 2%. The YTD September nine-month results for the India operations are on page 11. Sales were INR 435.58 million, EBITDA INR 790.5 million, EBIT INR 623.34 million, EBT INR 604.9 million, and PAT INR 450.3 million. This translates into a sales growth of 5% compared to the corresponding period in C2023, higher than the YTD weighted average market growth.
While sales grew by 5%, PAT grew by 22% year-on-year, and this was achieved by improving efficiencies, product mix, and strong focus on costs. The YTD nine-month results for Europe are on page 12. Sales were INR 2,244.5 million, a 12% decrease over the corresponding period last year. EBITDA was INR 3,669 million, EBIT INR 2,842 million, EBT INR 2,455 million, and PAT INR 1,923 million. To be noted here is that last year's PAT includes INR 3,356 million of profit from discontinued operations as mentioned previously. Despite the sales drop, EBITDA margin came in at around 16.3%. The consolidated YTD nine-month results are on page 13. Sales were INR 66,003 million, a slight decrease over last year. EBITDA was INR 11,574 million, EBIT INR 9,076 million, EBT INR 8,504 million, and PAT INR 6,425 million. As explained, that is about INR 642 crores.
As explained in the previous section, PAT includes INR 3,356 million of profits. That was for the previous year. Excluding the consolidated PAT for nine months YTD September 2023, it was INR 6,206 million. Last year, the YTD PAT included the INR 3,356 million of profits from CFG. Excluding that, last year's YTD September 2023 PAT was INR 6,206 million. Therefore, if you compare with the YTD September 2024 PAT of INR 6,425 million, we have achieved a PAT growth of 3.5% this year. It is to be noted that despite YTD consolidated sales being -1%, the PAT without discontinued operations has grown by 3.5%. With that, we can proceed to Q&A. Thanks.
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. You may press star and one to ask question. The first question is from the line of Siddhant from Goodwill. Please go ahead.
Yeah. Hi, Ander. I wanted to ask you about what do you feel about the health of European OEMs? I was going through Stellantis' [QW], and the headlines and the commentary does not seem too great.
Yes. Hello. Good morning, everybody. Our view is that the European OEMs are now suffering a lot because of the uncertainty that we see in the market. There are several things that are going on in the European market or in the automotive world, and one of them is the electrification. As you know, electrification in Europe has slowed down. The growth of the electrification has slowed down. We were expecting to end this year at about 20% of market share with zero-emission vehicles, and the reality is that they will be around 12%-13%, so it is much lower than expected. On top of that, from January next year, there will be penalties to the OEMs if they pass these levels of CO2 emissions in their average fleets.
If they are not getting the required electrified vehicles, they will have to pay a huge amount of money in penalties to the European Commission. This is also creating a big stress in the market and in the OEMs.
And also, additionally, with this uncertainty in the technology, the market is going down. We saw the first quarter was not bad, the second quarter was weaker. Third quarter has been quite weak with a drop of around 7% in the market. Probably we will see this trend to continue in the next quarters. All the car makers have issued profit warnings as the situation is quite unstable and uncertain. That's the environment we need to work for and we need to manage. That's one of the reasons of the drop that we have in our European business. On top of that, you know that we have another business working for off-highway trucks for U.S., mainly in our Metalcastelo business. That is still depressed. This market is still depressed.
We expect that this market will revamp during mid of next year after the U.S. elections are over and then the new government starts with the new policies. We will expect that the market will go up in the second half of the year. Okay, so that's the real task environment. Our customers are having difficulties. Uncertainty is there. The electrification is kind of blocked, or the parts of the growth is not happening. On top of that, in Europe at least, the additional stress factor is the entrance of the Chinese vehicles that are getting, let's say, bigger and bigger market share. Now with the duties that have been imposed, probably there will be a certain slowdown of the Chinese introduction, but the commercial war is also not helping to the global economy.
This is the environment that we are trying to navigate through and okay, this is the situation.
Thank you for the question, Sir. The next question is from the line of Jinesh Gandhi from Ambit Capital. Please go ahead, Sir.
Yeah. Just to clarify, did you indicate that Metalcastelo business and the end market in U.S. for off highway will recover from second half FY 2025 or we expect that to happen from first half itself, given new government will be in place?
We expect that this market to recover by Q2, Q3 2025. We will expect that in the next couple of quarters, we will keep the current situation, let's say the current depressed situation. We will not drop further. We are now in the bottom side of the cycle, then we expect to start recovering slowly. That's what our customers are informing us. Also, as you know, we got in Metalcastelo, an important business for electric transmission manufacturer in U.S., and these programs have been also delayed in U.S. So once these programs start ramping up, we will see also our sales in Metalcastelo going up. Yes, we need to wait. We are now managing the situation with our cost-cutting activities, and we are keeping the margins reasonably. I think that we have done a good job there.
Once we get again the market and we get again the sales in the next quarters, hopefully the sooner the better, but we can expect that it will happen in the Q2, Q3 next year. Then we will see our figures again ramping up.
Okay. What would be the current run rate for Metalcastelo in terms of quarterly run rate of revenues in Q2, how it was at peak and how it was in second quarter? If you can throw some light on that.
I didn't catch it.
Current run rate, what is the monthly rate right now and what it used to be earlier?
Okay.
So-
In just monthly figures, I can give you monthly figures. We were-
Quarterly.
-about EUR 6 million per month. That was the average, between EUR 6 -EUR 6.5. Now we are at between EUR 4 million and EUR 4.5 million. This is a drop of 30% approximately that we see in the last quarter. Probably we will keep this rate in the next couple of quarters, and then we will go up slowly. What we are projecting is that in the Q3, Q4, we will hit at least EUR 5 million, EUR 5.5 million in 2025.
Got it. Secondly, you have on the margin side in the European business, so we have done exceptionally good job to maintain margin. Can you talk about what areas have we focused on cost cutting to maintain margins? Does it come at the expense of scaling up business when the tide turns for the European operations? How do you think from that perspective?
Okay. That is one of the key things that now we are trying to manage because the market is what it is, and it is difficult to get additional turnover, at least in the short term. What we are now doing is we are trying to keep our costs as low as possible. We are stopping the factories and applying certain regulations and policies to stop the factories one day per week, these kind of things. Eliminating all the extra time, eliminating all the contract workers, temporary workers, and trying to reduce at minimum the cost level. This is something that we have done, and we have done successfully, so we have been able to keep our margins. Of course, we will lose some margin because we cannot offset all the drop. This is not possible.
We only lost 1%, 2%, and this is what we are trying to do. Our company, even this situation, are generating cash. We are cash generating unit even in these conditions. We are quite relaxed in that sense. There is no panic, no fear at all. The viability of the business is there, and we will for sure be stronger once this crisis is over, okay? You know that in this situation, the weaker competitors will suffer, so there will be a consolidation. We are already perceiving certain difficulties in some of our competitors in the region. We expect to be one of the winners when we consolidate the business coming from those stressed companies. Okay, so that is the situation. It is a sad situation. It is not the best of the scenarios, but this is something that we need to manage.
We did it in the past, and we will do now in the current.
Got it. Last question is on the Indian business. You talked about having delayed some of the orders which impacted growth. Can you elaborate on how big this order is there? How much is it delayed by? When do you expect commercialization of these orders? Any view on that will be very helpful.
Delay in India order book. Okay. Yes. In India, let's say that we had this performance on sales that is approximately 2% growth only in this quarter. We were expecting the market to behave better than this. It's true, we saw that the let's say four-wheeler market had just a negative performance in this quarter in India. We think that this is mainly coming from the inventory issues and also certain, let's say, market perception, but we are optimistic for the future. We think this will be overcome, and we will see again 5%-6% growth in the next quarters. I think the Indian market reduction, it's just a temporary issue. We don't see any risk there.
On top of that, we have been hit by the delay of the certain projects that we have, especially the export projects, and this is directly related to the status of the European automotive market, okay? With this slowdown, and especially with the delay of all the electrification programs that the customers are postponing because of the situation that they are facing. Okay, so there is a general delay on all the electrification programs, and we are just waiting for them. We will probably see in India the new programs that we got, especially in our Hosur plant, I mean, our brand new plant in Hosur. We already see certain ramp-ups happening. In the next quarters, we will see this growth and because these projects are ramping up, especially these programs for Stellantis in Europe. Okay?
That is the delay in the programs plus the weak market gave us just a small growth in this quarter. But we are quite sure that we will continue growing properly in the next quarter. We are still optimistic. We were expecting more for this quarter. Unfortunately, the market did not perform, but I think the basics and the, let us say, the background of the Indian market, I think it is very, very positive. Two-wheeler is doing well. I think tractors and commercial vehicles are weak, and those should recover also in the future.
Got it. Great. Thanks a lot.
Okay. Thank you very much.
Thank you. The next question is from the line of Pratik Kothari from Unique PMS. Go ahead, Sir.
Yes. Hi, good afternoon. So one on India. Despite the investments that you have made over the last few years and that not being ramped up, our margins are very good. So we have completely controlled our cost and this is what we are seeing, or this is despite waiting for ramp up to come and maybe we should see something more?
Yeah. No, you are right. We have controlled our costs perfectly in all this period. You know that we have been pushing a lot in efficiency and in the internal improvements, and these actions are paying results. So in that sense, we are quite satisfied. Our margins are, yes, close to this 18% that we were looking for. And, we are quite sure that we will get those figures. And if we had this additional growth that we were expecting, probably we would have improved our margins too. Okay. Yes, I think in India we are doing well. The potential to improve even more, of course, it will be supported by the growth of our turnover, and that is what we expect to do in the next quarters. Yeah.
Correct. This would be, I believe, function of the productivity gains that we have been trying to implement and see for the longest of things.
This improvement in India margins is due to productivity improvements that-
Yeah.
-we have been doing for, and these are the past projects and productivity improvement.
Yes, that is true. Not only that, during this week, we have been working here with all the operational teams, and we have identified several improvement plans in all the verticals, and we continue this path so we can expect even further improvements, and let's say better performance in the next years, thanks to this action plan that we have already prepared. Of course, if these action plans are supported by higher sales, the situation will be much better. I would say that all the verticals are doing quite well in India. We have had a better growth in aluminum. Aluminum is outperforming the rest of the businesses in terms of growth. Also, our composite business is growing well. Our gear business is also doing well.
Then, the businesses depending more on commercial vehicles and tractors have been suffering more like our castings or our forgings divisions. But overall, you saw the results and the margins, we were able to keep this close to 18%, a little bit less than 18%. So that's the target that we have in the short term.
Correct. One comment on exports from India. We were at 12%-13% of sales. Where are we in any outlook, any developments there?
Yeah. The exports in this quarter were reduced a little bit because of the market situation outside. The demand has gone down in Europe and U.S., so the export will be around 10% because exactly it's around 10% this quarter.
10%, 11%.
Yes. Between 10% and 11%. That is the reality. And we are already working to increase these export rates. As a global company, we have a policy to supply our customers local to local. That was the CIE global policy, because we are present in all the automotive regions in the world. So avoiding transport costs, big inventories, geopolitical risks, foreign exchange rate risks, that is the global strategy. But of course, in certain technologies where we are very competitive in India, we will take the advantage of exporting as much as we can. This is also one of the areas that we need to improve compared to our competitors who we are below, mainly because of this CIE strategy as we are a global company. But, we expect to continue growing in the near future.
At least, reaching 15% of our export rate should be quite easy in the next years.
Correct. The last question on Europe, in EV market specifically, the governments there are trying to put this anti-dumping or trade barriers, et cetera, for the Chinese onslaught. For us as companies, do we go out and get these Chinese OEMs to be our customers? Because if they still go through, the cars might be sold in Europe, but it will not be through our customers. So, how do we think about that?
Yes. I think the Chinese car makers, of course, they are producing in China and exporting to Europe, are now thinking because of these import duties that they have been imposed, they are pushing or they are now preparing their production in Europe. They want to localize the production of the cars in Europe. So they had already announced as BYD or let's say, SAIC MG, they are planning to produce cars in Europe. Of course, we will try to be their suppliers. Once they are in Europe, they will need European suppliers, so we will for sure try to work for them. This is one of the targets. We know that it will be not easy because of their current supply base and costs are different in China, but they will necessarily need to adapt to the cost standards that are in Europe.
So, I am sure that we will be able to work with them. We are working for almost all the car makers in the world, and I can say that. So we have a very, let's say, huge panel of customers, completely balanced, and no one is more than 10% in our total turnover. So that is a good point, that we have a diversified portfolio, and we want to continue like that. If changes are coming to Europe, we will supply them happily from Europe.
Great. Thank you and all the best.
Thank you very much.
Yeah, thanks.
Thank you. The next question is from the line of V Rangan from [AN Analyst. Please go ahead, Sir.
[inaudible]
We are unable to hear.
[inaudible]
Hello?
[inaudible]
Moderator, I think we cannot hear anything from-
We'll take the next. Sir, we can't hear him. We're taking the next question from the line of Bharat Sheth from Quest Investment.
Hi, good afternoon, and thanks for the opportunity. Sir, initial, your remark on the European market, you said that certain duties related to levy on account of this emission norm. If you can give a little more color, and that because of the impact will remain only up to this Q4, I mean, say, last quarter of calendar year or next year, how do we see for Europe market? About Metalcastelo, you have already given some color. Remaining part of the business, how do we see?
Okay. What we were explaining is that in Europe, in this Q3, we saw a drop of about 7% in the market. What we can expect is that in the next quarters, this trend, this level will continue, okay? In this - 7%, - 10%, those in that range, the market will remain in that situation. No one is expecting a revamp in the short term, okay? Unless there is any, let's say, political action that we are not aware of. Okay?
Okay.
Regarding the Because we are always talking about production, okay? Production in Europe. Part of the sales in Europe are coming from the imports that Chinese car makers are doing. Approximately one million Chinese cars are sold in Europe in this moment. These cars are mainly electric vehicles where they can offer very cheap and very competitive cars that are, let's say, affecting to the electric cars produced in Europe because most of the price gap is important. They are getting this market share. In order to avoid this situation, the European Commission set up certain import duties to the Chinese electric cars, okay? Mainly, there is a variation between, they have a basic duty of 10%, and on top of that 10%, some of the car makers have a duty of even 78 additional percent. Okay?
We expect that this will slow down the import of the Chinese cars. We will see, because we do not have any data yet. What we see also, and what we think, is that these import duties will encourage Chinese car makers to implement and to launch factories in Europe, to produce in Europe to avoid this import duty. We will see certain changes in the market for sure due to this situation. That is our view. Coming back to the Metalcastelo's evolution, Metalcastelo is in a very, let us say, weak situation because we are now selling this in the range of EUR 4 million -EUR 4.5 million per month, mainly because of the drop in the export market to the U.S. The off-highway market in U.S. is very low, and we expect this to recover in the second half of next year.
During the next quarters, we will maintain the current situation. Despite this drop, we have done our job in terms of cost reduction, so the profitability is nice, we maintain a nice EBITDA margin there, and we are generating cash. Let us say that we are waiting for the market to revamp, and we will be ready to capture when this happens. In this moment, the situation is that we are not nervous. The situation is full under control, and we will wait for the better moments to come.
Because of import duty on this Chinese manufacturer, can we expect that in calendar 2025, in Q1 or Q2, we see some kind of a positive trend in the Europe market?
We think that in the electric vehicle market, we should see this improvement, yes. That is what we can expect, but this is something that we need to wait and see. That is the expectations and in fact, that is the reason of the duty imposed by the European Commission. The explanation of this duty is because these low prices that Chinese cars are offering in Europe is mainly because of the subsidies that they are receiving in China. They wanted to offset and to have, let us say, the same level for all of us.
Here, there are two questions. As you rightly said that, say some Chinese car will start looking to manufacture in Europe. But with that duty also coming, there will be an equal playing field for one European player. First, we will see an improvement in the European car manufacturer, or we will see that Chinese will start procuring some component from within Europe?
I think with the Chinese car makers producing in Europe, they will avoid these duties as they will produce in Europe so that duty will not happen. And of course, producing in Europe, they will have higher costs. And we also expect that they will source their components from European suppliers, and we expect to be there to serve them, okay? That is the basic. So we think that we will have additional customers to work with. Also the point is that from the technological point, the Chinese electric vehicles are, let's say, now in the top of the technology and they are getting, let's say, they are in a very good position from technological point. So we will see how the European car makers react and how this, let's say, commercial battle ends, okay? But from our point of view, let's say that we are customer agnostic and technology agnostic.
We would be happy to work with Chinese and even to continue working with our European customers where we have excellent relationship, and we are also supporting them in the electric vehicles as we have a lot of projects in the pipeline that are delayed with Volkswagen, with Ford, with Daimler. We are working with all of them, with Stellantis, with Renault. So we are working with all of them. So we expect that if this growth of the electric vehicles happen, we will also get this business in CIE and in CIE India too.
Is it also, just to understand a little more on affecting their new development program also, European car manufacturing?
No. With this uncertainty around EVs affecting new model development for European OEM manufacturers, new platforms. They are unable to decide what to develop.
Okay. There is a big uncertainty there, yes. I did not catch the question, sorry. The uncertainty is there and certain car makers, they are now pushing for the production of the internal combustion engines because the demand of the electric vehicles has gone down. There is a change in their minds and a change in their policy. In the short term, I am not thinking in the long term, but in the short term, they have to adapt to the market requirements. That is happening for sure. We are, for example, seeing that the diesel cars are growing. We are producing certain components for diesel, and suddenly they are going up, mainly because of the, let us say, short term demand that is more inclined to go to diesel and gasoline rather than the electric. But in the midterm, we see that the electrification will win, okay?
It seems that it is a very clear picture, and we were checking the IHS forecasts for 2030 when six months ago, they were saying that 60% of the cars will be pure electric in 2030. That is in five, six years' time. Now, they say that in 2030, only 50% of the cars will be pure electric. In all the interactions that we have with our customers, and they have their own, let us say, studies and forecasts, most of them, they are showing that they expect the electric vehicles to be between 30% - 40% in that period. There is a big uncertainty there. Depending on the policies from the European Commission, it can be 50%, it can be 30%. Depending on the policy, it will change.
What we see now for sure is that there is a slowdown because of, let us say, the users that do not rely 100% on the electric vehicle because the infrastructure is not yet still there, and there are certain risks around the range anxiety and all these kind of things that are not fully solved yet. Yeah, Bharat Dai, is that okay, or do you want more explanation? Hello, can you hear us, moderator?
Sir?
Yeah.
The participant line got disconnected.
Yes. Okay. Thank you.
Okay. The next question is from the line of Nemish Shah from Emkay Investment Managers Limited. Please go ahead.
Yeah, thanks for the opportunity. I had a few questions on our India business. You mentioned that the delay in ramp up of certain export projects. Are these orders for global customers or are these orders for domestic customers for their exports? If you can just give some-
No.
-clarity on that.
They are for global customers. They are from global customers like Stellantis and these are our main customers for these programs of exports.
Got it. In the India business, our medium to long term aspiration has been to grow 400 bps- 500 bps faster than the blended average industry growth. Is it linked to these projects which are getting delayed or there is something else as well that we need to add some more customers or gain some more market share for that growth to pick up?
You are right. We still keep this target to grow this 5% above the market. Unfortunately, we didn't get these figures mainly because of the delay on these programs. That has been a reality. In the future, we will continue pursuing for that. Our order book that we follow every month is also in a very healthy situation. We are getting new businesses. We expect once these programs start ramping up and the new programs that we are getting are ramping up, we hope that we will be able to match this target, yes.
Yeah, got it. That is it from my side. Thank you.
Thank you.
Thank you. Participants who wish to ask a question may press star and one. The next question is from the line of Shivam, who is an Individual Investor. Please go ahead.
Hello. Thanks for the question, Sir. As you said that the European pressure will be next half of the next financial year. So will there be pressure on the revenue still then?
Shivang, can you repeat it? Are you asking whether there will be revenue pressure in Europe for us in the next calendar year? Is that the question?
Yes.
Yes, the answer is yes. As pointed out, in Europe, we expect the off-road highway market to start coming back from Q2 or Q3 of next year. As far as the light vehicle market is concerned, Ander has explained that for the next few quarters, we do expect it to remain declining on a year-on-year basis for the next few quarters. Largely because of the uncertainty around the various factors that Ander explained, the emission tax, the uncertainty around the EV market, et cetera. For the next few quarters, till this thing clears out a little bit more, even the light vehicle market will remain depressed. We expect it to Like this quarter, the European light vehicle market de-grew by 7%. So, in that kind of range is what we expect for the next few quarters.
So, you're planning for a negative year next year on a consolidated basis?
Let's not talk about our revenue. We are talking about the market in Europe.
Yeah. And normal follow-up is about your revenue.
No, like-
Will there be planning for the next calendar year, your revenue?
Let's not talk about some forward-looking statements here. But as far as we do expect the Indian market to recover, as we pointed out, we expect the light vehicle market was negative this quarter. It will not remain negative. I think the tractor markets are picking up. The two-wheeler market remains quite good, close to 8%-10% growth definitely. So to that extent, the Indian market will recover and the European market will be negative at least for the next two quarters, two or three quarters.
That's it. As far as what happens to our consolidated revenue, we'll come to it. As we said, it is not only about the markets, it's also about some of our order book coming back, like being ramped up, which have been delayed, especially the Stellantis order in India, which is a very large order that we are talking about. What happens to our consolidated revenue? We'll see. We'll perhaps see the trends in the first two quarters next year, and then we can take a call on that. But what we are talking about is the market situation in India and Europe.
You are saying that the Indian business will compensate for the growth that will lag in the European business. That's what you're saying?
As I said, let us not go there in terms of what happens to our. We are not forecasting our revenue here. As I said, let's look at what happens in Q4, Q1, and then we can make some estimates.
Is there any plan, like internal plan, to get some growth out of Europe in this weak market? Or there won't be any growth that will be expected.
Next two, three quarters, definitely not. We are looking at a negative market situation. As I said, once it stabilizes, let's go back to what is happening in the European light vehicle market. There are two factors. The EV demand is not ramping up as fast as what people thought it would be. Ander explained how IHS Markit has reduced forecasts. All OEMs are reducing forecasts. Over and above that, there is the stock of this emission penalty, which will be levied if you do not produce enough EVs. Because of these two contradictory factors, there is a lot of uncertainty in the light vehicle market in Europe. Once that uncertainty clears off, then, of course, the production trends would be clearer.
Over and above that, there is also the third factor that Ander talked about, is the imports from China, which is almost amounting to EUR 1 million this year. Normally, European sales and production are fairly equal to each other. This year, there has been some difference. On a YTD basis, almost EUR 1 million difference is there. This is the third factor. Once all of these three factors clear off to an extent, then we will know what the real production trends in the European market is. Till then, there is uncertainty. In that uncertainty, we do think that the drop in market that we see in this quarter, a similar kind of trend will go on for at least two or three quarters. Once it clears off, things will become clearer. We don't know what would be the. Will it start growing back again?
Perhaps, but we don't know for sure at this point of time. Right now, we are focused on this market environment and working within this market environment.
Any feedback that you are getting from your customers, like are they stopping orders or they are building up the inventory or they are not giving the fresh orders? Like any feedback, any outlook from them you are getting?
European OEMs, you are talking about?
Yeah, the European customers.
Whatever we talked about is based on the feedback from them only.
Okay, great. Okay, Sir. Thank you so much.
Yeah. Thank you. Take care.
Thank you. The next question is from the line of from ChrysCapital. Please go ahead, Sir.
Hi. Thank you for the opportunity. Just one question. How has the growth been for us from our non-anchor accounts? Toyota, Hyundai, Kia, Royal Enfield, could you spell that out, please?
So growth outside M&M, Maruti and Bajaj. How is it?
Outside our anchor accounts for the last one to two years.
Okay.
How is it?
The customers are behaving according to the market. This is the evolution. We are now trying to grow with Hyundai. You know that in the last quarters, the evolution was not as good as expected, but the trend and expectations are positive. We are developing our, let's say, customer pie and we are trying to grow with them, and we have several projects with them in the negotiations and in the pipeline. My view of this is that we are trying to, let's say, open our customer portfolio and to grow, especially with Toyota, with Hyundai, with let's say even Volkswagen. We are growing with all of them. Tata, with Tata we have several projects also in the pipeline. I think as I said, we started our main customer was Mahindra, and Mahindra Bajaj are the two main pillars from our customer base.
In the future, we want to open this pie and get this redistributed share or distribute the weight of all the car makers in India. We are working with all of them, and the expectations are positive with all of them.
If you look at the growth number, which is 2% for us, M&M Auto is obviously much higher than that. M&M Tractors are around about at that figure, so is Maruti, and Bajaj is also much higher. Between M&M Auto and Bajaj, we have done well. Maruti and Mahindra Tractors are okay. Exports have not done as well, as Ander pointed out. Frankly, exports YTD this year has been lower than last year, and therefore the proportion has come down, as Ander has pointed out. For the other non-anchor customers, we have done reasonably well.
If you look at it in this fashion, then it is the export part of the business that has not done as well. But the other non-anchor customers in India are doing reasonably well.
How large of our revenue mix would be our non-anchor customers?
Our anchor customers, if you look at M&M, Maruti and Bajaj, is roughly around 55% of our business in India. Exports currently are roughly about, or last year, those are the numbers that we have put out in the public domain, was roughly about 14% last year. The others were the domestic non-anchor customers.
Okay. The domestic non-anchor customers have seen a good growth on a small basis.
They are reasonable. Where this year we have not done well is on the export side, especially because some of our orders, and Ander Arenaza Álvarez has specifically pointed out about Stellantis, which is a global order that we had, it will do well. I think Stellantis is making a comeback. And once it ramps up, it will be a good addition to our top line.
Okay. Thank you so much.
Yeah. Thank you.
Thank you. The next question is from the line of Siddhant from Goodwill. Please go ahead, Sir.
Yeah, just in the Chinese set up manufacturing in Europe, have Chinese auto ancillaries also started acquiring European assets or setting up manufacturing there, especially in the space that we are catering to?
Let's see. Have Chinese component companies entering Europe and setting up plants in Europe?
Okay. Not yet. We have seen a couple of examples of Chinese component makers entering Europe, but I can tell you that till now there is no relevant move, just small companies or a small amount of companies that are entering Europe. I would say that this move has not happened yet.
Okay. Like you said, there's some anti-dumping duties and anti-subsidy duties that have been put on cars. Are these duties also applicable on components of cars?
No, this is not. It is only applicable to the cars or vehicles.
Thank you.
Yes.
Okay. Wonderful. Thank you.
Thank you.
Thank you. The next question is from the line of Bharat Sheth from Quest Investment. Please go ahead, Sir.
I said sorry. My line was disconnected, and I was dropped out. Remaining question answer I already got it and wish you all a festive season greeting. Thank you.
Thank you very much.
Same for you.
Thank you, Bharat.
Thank you.
As there are no further question, I would now like to hand the conference over to management for closing comment.
Okay. Thank you very much to all the participants for your questions and for your interest in our company. We hope that we answered the questions properly and you have now the better understanding of where we are as a company. We thank you for your trust on us, and we expect to continue growing and doing a good job. As always, I will say thank you to all the team that is working in CIE Automotive India, that is doing a fantastic job, and my recognition to all of them. Finally, I wish you a very happy festive season and very happy Diwali. Goodbye.
Thanks. Happy Diwali to all.