Ladies and gentlemen, good day and welcome to the ASK Automotive Q4 and FY 2025 post earnings call hosted by Adfactors PR. 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 touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Rishab Shah. Thank you, and over to you, sir.
Thank you. A very good evening to everyone, and warm welcome to the Q4 and FY 2025 earnings call of ASK Automotive Limited. From the senior management, we have with us Mr. Kuldeep Singh Rathee, Chairman and Managing Director, Mr. Aman Rathee, Full-Time Director, and Mr. Naresh Kumar Sharma, Chief Financial Officer. Before we begin the earnings call, I would like to mention that some of the statements made during today's call may be forward-looking in nature, and hence it may involve risks and uncertainties, including those related to future financials and operating performance of the company. Please bear with us if there are any call drops during the course of the conference call. We would ensure that the call is reconnected at the earliest. I would now like to hand over the call to Mr. Kuldeep Singh Rathee, Chairman and Managing Director, for his opening remarks.
Thank you, and over to you, sir.
Good evening, ladies and gentlemen. It is my great pleasure to welcome you all to our quarter four and FY 2025 earnings conference Call. I hope you have had the opportunity to review the detailed presentation submitted to the exchanges and available on our website. As we all are aware, the global economy is facing headwinds which have caused uncertainty across the world, especially in the emerging economies. However, the Indian economy remains resilient based on its sound economic growth and strong fundamentals. Adding to this positive outlook, the Indian Meteorological Department's forecast of an above-average normal monsoon brings renewed optimism, especially for the rural economy. This is particularly encouraging for the two-wheeler industry. Now, let me begin by sharing a quick overview of the broader industry as reported by SIAM.
The Indian automobile sector witnessed healthy momentum in FY 2025, with overall vehicle production across all segments registering a robust year-on-year growth of 9.1%. The Two-Wheeler segment, in particular, stood out with a production growth of 11.3% on a year-on-year basis. This recovery is because of the rising rural demand and a notable resurgence in consumer confidence. As a result, two-wheeler domestic sales grew by 9.1% year-on-year. This segment was supported by better connectivity in rural and semi-urban areas, along with the launch of new models offering enhanced features and greater value. The Two-wheeler industry closed financial year 2025 with a strong production volume of 23.9 million units, up from 21.15 million units in FY 2024. In Q4 alone, production touched 5.8 million units as compared to 5.5 million in the same quarter last year.
On the exports front, the two-wheeler segment delivered an impressive performance with a 21.4% increase year-on-year, reaching 4.2 million units. This was driven by the introduction of new models and successful penetration into new international markets. Turning to electric vehicles, a key focus area for our industry, total EV registrations in the country reached 1.97 million units in FY 2025, making a 16.9% growth year-on-year. However, it still has a share of business of less than 5% of the total two-wheeler industry. Our share of business is growing as per the growth of the EV industry. Looking ahead, we believe that industry stands to gain further from supportive macroeconomic policies.
The recent reforms in personal income tax announced in the Union Budget 2025-2026, combined with two successive rate cuts by the Reserve Bank of India, are likely to enhance consumer purchasing power and improve access to vehicle financing, creating a conducive environment for sustained demand. The good monsoon forecast will ensure rising income in the agriculture sector and will be beneficial for the two-wheeler sector. With this positive backdrop, we remain optimistic about the growth trajectory of the sector in the coming quarters. Before we move on to ASK's business performance, I would like to highlight an important development from this year. CRISIL ratings upgraded our long-term credit rating from AA- to AA, while reaffirming our short-term rating at CRISIL A1+. This upgrade reflects the company has improved capital structure, better financial flexibility, and strong volume growth.
Moving on to the business updates, I am delighted to share with you that we had a strong finish to the fourth quarter and full- year in both revenue and profitability. This marks our sixth consecutive quarter of robust performance since the company's listing last year. During Q4 FY 2025, we delivered a growth of 8.5% in revenue, 24.7% in EBITDA, and 20.6% in PAT on a year-on-year basis. We continue to outperform the two-wheeler industry in terms of vehicle production growth during Q4 FY 2025. Additionally, we delivered an EBITDA margin of 12.5% in Q4 FY 2025, representing an improvement of 162 basis points over Q4 FY 2024. As a result of strong performance in Q4 FY 2025, we have surpassed our FY 2025 EBITDA margin guidance by achieving a full-year EBITDA margin of 12.3%. Our revenue has grown by 20.2%, EBITDA by 42.7%, and PER by 42.5% in FY 2025 on a year-on-year basis.
Our EBITDA margins for the year stood at 12.3% in FY 2025, with an improvement of 193 basis points on a year-on-year basis. Our aim is not only to sustain this level of EBITDA margins but to improve gradually in the subsequent quarters, depending upon the growth of the two-wheeler industry in FY26. With strong performance and profitability, our earnings per share in FY 2025 has increased to INR 12.60 per share against INR 8.80 per share in the same period last year. Our all three product segments performed well in FY 2025 in terms of revenue growth. We have sustained our market leadership position in the advanced braking system. Our advanced braking system revenue grew by 9% in Q4 and 16% in FY 2025 on a year-on-year basis. The aluminum lightweighting precision solutions revenue grew by 21% in Q4 and 28% in FY 2025 on a year-on-year basis.
The safety control cable revenue also recorded growth of 1% in Q4 and 14% in FY2 25 on a year-on-year basis. As mentioned in DRHP, our wheel assembly business has very low margin, and we were requesting the customer for the last two years to shift this business to someone else. Now, the customer has shifted 60% business from Q4 FY 2025. In FY 2026, it will impact our revenues by approximately 300 crores. However, our EBITDA margins will improve by 80 basis points on account of this. In the dynamic and unstable global geopolitical environment, our revenue from exports remained the same at INR 147 crore against INR 174 crore last year also. As expressed in the previous interactions, I am delighted to share that we have achieved double-digit EBITDA margins at 12.5% in Q4 and 12.3% in FY 2025, compared to 10.3% in last year.
Improvement in margins during FY 2025 was mainly driven by better economies of scale, improved volumes, better product mix to the customers, and continued focus on cost optimization. We have delivered strong returns in FY 2025 with ROAC at 27.7% and ROE at 26.5%. We have also improved our debt profile with debt-to-equity reducing 0.238 against 0.42 last year. Our average debt-to-EBITDA is at 0.83 in FY 2025. The board has recommended a dividend of 75%, that is INR 1.50 per equity share on the face value of INR 2 each. I would now like to give you updates that our Bangalore facility started commercial production on 14 January 2025, and ramping up fast. This will be our eighth manufacturing facility and the third one in South India.
Our largest manufacturing facility at Karoli, Rajasthan, with an investment of INR 4.9 billion as of 31 March 2025, is ramping up fast to deliver future growth. Some more key new initiatives to be highlighted are the SI signed technical collaboration agreement with LIOHO Taiwan to manufacture two-wheeler HPDC alloy wheels in February 2024. The capacity already built up, and the product is under testing. We entered into a strategic partnership with Kyushu Yanagawa Seiki Co., Ltd., Japan, in March 2025 for high-pressure die-casted alloy wheels for two-wheelers. We also signed a joint venture agreement with Aisin Group, Japan, a top-10 global Tier 1 auto component supplier, to market and sell passenger car products in independent aftermarket in April 2024. Product range unveiled at Bharat Mobility Global Expo 2025. The products have been launched in market in April 2025.
Largest manufacturing plant at Karoli, Rajasthan, with investment of INR 4.9 billion up to March 31, 2025, is ramping up fast to deliver future growth. Bangalore facility started commercial production on 14 January and ramping up fast. These initiatives underscore ASK Automotive's commitment to innovation, sustainability, and market leadership. Thank you very much for your patience, and this will leave the floor open for question- and- answer. Thank you.
Thank you, sir. Ladies and gentlemen, 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. The first question comes from the line of Mahesh Attal from Attal Investment Advisors. Please go ahead.
Can I ask my question in Hindi?
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And sir. [Foreign language]
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Market size of this product, entire product profile Aisin Group. [Foreign language]
[Foreign language] And this is a trading venture, it is not a manufacturing venture. You should appreciate that.
All right, all right, all right. Thank you so much, thank you so much.
Thank you. The next question comes from the line of Ronak Mehta from ICICI Securities. Please go ahead.
Yeah, hi, thanks for the opportunity. Hi, sir, congratulations on a good set of numbers. I have two questions. First is, can you highlight some of the new order waves that will drive your continued outperformance for the next year? Because I believe alloy wheel business is still in the product testing and the testing. So apart from those, apart from the alloy wheel business, what all other new orders can highlight? That will be the first question.
See, we have the orders. I can only assure you that we will be growing in the mid-teens and we'll outperform the market, outperform the industry again in this financial year because we have the confirmed orders to that extent. However, we also expect that the alloy wheel with high-pressure die-casting that we made with the Taiwan technology is under an advanced stage of testing, and we hope to get the clearances by June or July end. We are confident of starting the supplies in the H2 of this financial year.
Okay. So is it fair to believe that the second half will see alloy wheels, so about INR 100 crore revenue from alloy wheels for this year, outlook for this year?
Oh, let the things stabilize. I can't quantify the numbers like that, but yes, as I've told you, we will again outperform the industry as is our track record.
All right. The second question is on the EV business. So as EVs become more prevalent, what role do you foresee ASK Automotive playing in the supply chain? Would you restrict yourselves to just aluminum casting, which is an EV agnostic component, or are you open to a bigger role in the ecosystem with EV-specific components? Slightly longer-term question.
Overall, we are playing a bigger role. We are already supplying to 80% of the organized EV market for the last two years. But as you know, the EV market still has less than 5% of the total two-wheeler market. So we are growing as the EV market is growing. However, our content per vehicle is higher because of the aluminum lightweighting components in the EV segment. So if it grows faster, we will also gain in.
Okay. So actually, my question was with respect to new products specifically for EVs. Are you also looking at adding new products specifically for EVs apart from the aluminum casting-related products, or you'll restrict yourselves to aluminum casting?
We have the three verticals at the moment, so we'll remain in the three verticals.
All right. Okay. Sure. Thank you.
Thank you. A reminder to all participants, you may press Star and one to ask a question. The next question comes from the line of Naveen Dubey from Narnolia Financial Services. Please go ahead.
Thanks for the opportunity, sir, and congratulations on a very good set of numbers. My question is firstly related to the two-wheeler industry. So recently, Hero is saying that the two-wheeler industry is expected to grow around 6%-8% in 2026. So how do you in the domestic market, and how do we see export markets to pan out? Any thoughts on export markets also?
As far as the two-wheeler industry is concerned, we are also very hopeful that it will grow about 6%-8%, what Hero has said, and we are confident because of the various reasons, just like I mentioned, good monsoon, interest rate cut, and the tax benefits the government gave with the budget, so that kind of growth we will see of the two-wheeler, number one, and number two, exports. I think the geopolitical situation is quite dicey at the moment because of the tariffs and the various falls, but I am an optimist, and I hope the clouds will clear very soon, and we expect a very good growth in this year, so last year, we could remain constant, stagnant, but this year, we are still hopeful of a very good growth in the exports.
Okay. The second question is related to the agreement which we have done with Kyushu Yanagawa, Japan. Sir, is this product related to ICE or specifically to EV products?
This can go in both vehicles, ICE as well as EV.
Okay. Okay. And we have done two technical agreements in the last two years. So, any other agreement in pipeline or any other for any other product existencies, are we looking at?
We keep on looking for good technical opportunities. As you say, as you will see, you have seen that we like to have the first-mover advantage. So we are talking to many different people, and once something materializes, the whole market will know through the stock exchange.
Great to hear on that front, sir. A couple of questions related to one is, we have seen a sharp improvement in gross margin. So I think that is related to that wheel assembly business or any other thing?
Wheel Assembly business has gone only from March only. So there's not much to be seen in the last financial year 2025. However, in the financial year 2026, as we said, the revenue will drop by INR 300 crore. However, the margins will go because of the Wheel Assembly by 80 basis points.
Okay. Okay. Thank you. Thank you, sir. That's it from my side.
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question comes from the line of Abinash S from NAFA AMC . Please go ahead.
Hi, sir. Congrats on a good set of numbers. So when I went to your PPT, you had mentioned that you already had a partnership, technical collaboration with LIOHO to manufacture HPDC. And in March 2025, we have signed a new technical collaboration with another manufacturer. So what is the reason for signing up with a new person? Is it a different technology or a different grade of technology for the same HPDC, or is there any delays in LIOHO technical arrangement? That's question number one. Question number two is, you have said that the capacity utilization is improving in the Karoli plant. So at what is the current utilization rate, and when can we achieve full utilization? And at full utilization, what would be our peak revenue? Because that being our largest plant. So could you provide some insights? That would be great too. Thank you.
Yeah. Regarding the two collaborations, we have the first-mover advantage with that technology, and we want to be the best in the class. That has been the philosophy of the company. So we'll imbibe both the technologies, and the Japanese player will be feeding the Japanese customer more, and the Taiwanese player will be feeding the rest of the market. That has been the philosophy behind it, number one. And the second question, what was that?
Karoli.
Karoli. Karoli, we have already invested INR 490 crores, as I mentioned, till March end. The investments are still carrying on because we have a huge potential in the growth in Karoli. So another approximately INR 200 crores will be spending this year also further. And the peak potential of the Karoli plant will be around INR 1,100 crores- INR 1,200 crores, which we will see in the times to come. At the moment, the Karoli plant, we have revenues of about INR 500 crores- INR 600 crores, and it's operating on 50% capacity utilization.
Thank you, sir.
Thank you. Participants, please press Star and one to ask a question. The next question comes from the line of Bismith Nayak from Courser Park Advisors. Please go ahead.
Thank you. So my first question would be on, we have seen a sharp slowdown in growth. Earlier, we were growing around 20%-30%. Now this quarter, we have grown 9%. So was there a one-off in the base or something, or postponement of order or something like that?
No, no. There's neither postponement of order. Nothing has happened. We have grown at 9%. However, actual growth has been 16% if we count, as I just mentioned, that the wheel assembly, 60% of the wheel assembly went from 15th February onward. So if we add on what would have been the revenue of that, then it would have been 16% growth.
Understood.
This phenomenon will play in the next financial year also because, as I said, that if we were supposed to, let's say, grow 20%, then out of that, that INR 300 crore business of the financial year will be seeing less.
Understood, sir. And in an interview in the morning, they called out the 14% guidance for FY 2026. So 80%.
Yes, sir.
80% coming from Wheel Assembly.
In my interview in the morning, I said that we'll be improving by 150 basis points, so that becomes 13.8%. And I said, out of this 150 basis points, 80 basis points will come because the wheel assembly has gone, and 70 basis points will come for the internal more efficiencies and economies of scale. However, we are aiming to achieve 14% EBITDA margins next year, this coming financial year.
Understood, sir. Lastly, on the die-cast HPDC wheels, who are the major players in gravity die-casting? Who will be our competitors? From whom will we take market share?
First, let the product be tested and approved, I think, because there's so many gravity die-casting players, as you know very well, at the market.
Sure.
We can't say whose share will come once it is approved. So that is the OEMs.
Sure, sir. Who are the top players? Who will be the top players in the segments that we are targeting?
So the top players here will target all the OEMs for their scooter and motorcycle alloy wheels. So once they let the product be tested and approved, then it is for them to judge what are the advantages and who's share or whether they don't cut anybody's share. They just cut the import part or something, which.
Understood, sir. One last question. Any plans of drum or disc brakes?
Disc brakes, we are already supplying to the system suppliers. We are not into the system, and we don't intend to be the system. That's a very small market of the two-wheeler. But we already supply the disc brake pads. We are supplying to Brembo for Hero as that it goes there and also to Endurance. Moreover, we are exporting also the two-wheeler disc brake pad to the European market.
Understood, sir. Thank you.
Thank you. A reminder to all participants, you may press Star and one to ask a question. Participants, please press Star and one to ask a question. A reminder to all participants, you may press star and one to ask a question. The next question comes from the line of Mahesh Attal from Attal Investment Advisors. Please go ahead.
Sir, in financial 2025, what will be the scope of our borrowing? Can you give a little detail about that, that are we going to reduce? Will we reduce it or keep it at the same level? Second, this is, I also wanted to know about the cable business, that why is our growth not happening in cable? Why are we not able to, meaning why not us, what we have achieved in our braking system, why are we not able to do that in cable? What problems are coming in that?
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Borrowings, amount to.
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[Foreign language] All right, sir. Thank you.
Thank you. The next question comes from the line of Naveen Dubey from Narnolia Financial Services. Please go ahead.
Thanks for the opportunity again. Just two questions. One is, our working capital has improved over the last two years. Sir, what are the drivers for improving this?
The one driver is certainly the very good inventory management, and the second is, I think, our customers are also so good that they are paying us on before time even.
Okay. Okay. And.
It is other. Another question?
Sorry, sir. Yeah?
Ha, Naveen?
Second question is on how big we can scale our Bangalore plant. I mean, we are investing, and how further we can go from here on?
[Foreign language] will be investing INR 100 crores more this year. So that will be an investment of about INR 250 crores, and so it will give us a revenue of approximately INR 400 crores or so, yeah, 4 to 500.
Okay, sir. Further [Foreign language] we have to go for greenfield if we go ahead.
[Foreign language] whether we should go to Gujarat or we should go to Bangalore, because we anticipate with one customer, Gujarat also the expansion is coming.
Okay. Okay. That's great. Thank you, sir. Thank you. And all the very best for future endeavors.
All right.
Thank you.
Thank you, Naveen Dubey .
The next question comes from the line of Kairav Sundar from Spark Capital. Please go ahead.
Hi, sir. Congratulations on a good set of numbers. I just wanted to check with you on capacity utilization across our plants, and especially the new plants in Bangalore and Karoli. Also, if you can give it segment-wise if possible.
No, the capacity of all our plants except Karoli and Bangalore has just started. It will be starting this quarter only, actually. And so capacity utilization of Karoli plant, I have repeatedly said, is around 50%-55%. And even this new plant in Bangalore, we expect this end of the last quarter of this FY 2026, we should have a capacity utilization of 60%-70%. Rest all plants are in full capacity.
Okay. Thank you, sir.
Thank you. The next question comes from the line of Joseph from IIFL Capital. Please go ahead.
Hi, sir. Just one question. You mentioned that you're going to spend some INR 450 crore this year. Is that entire or CapEx plan? So is that entire amount going to be spent in FY 2026?
Yes, this is entire. Entire. That's what we propose to do, as I said, that we'll be making additional capacities. And out of that, the bigger amount of about INR 150 crores- INR 200 crores will be for this alloy wheel plant for the Japanese collaboration, of which we will see the results in the next financial year.
Sure, sir. And when we think about CapEx beyond FY 2026, is that, I mean, is the intensity going to be as high, or do you expect the intensity to come off?
We are optimists, so we always think that the intensity should remain the same because now the world is looking at India. Hopefully, once the peace prevails throughout the world, I think they will look towards India.
Sure, sir. Okay. Thank you.
Thank you. The next question comes from the line of Hitesh Thakurani from HDFC Securities Institutional Equities. Please go ahead.
Yeah, hi. So my first question is on the content for vehicles. How different is it in a motorcycle versus a scooter? And do we view the scooterization trend continuing?
We have a content that is almost similar. There's hardly any difference. Yes, at the moment, there is a trend towards scooters, which is good.
Sure, sir. And my second question is, how much more expensive on average is an HPDC alloy wheel than a regular alloy wheel? And what are the benefits of the HPDC technology?
Pricing. Pricing, we don't know at the moment. Once we start the supplies, and then probably in the next two calls, we'll be able to tell you about the difference in pricing or something. But well, the supplies should be smooth with less rejection. That's what our presumption is, and the HPDC alloy wheel.
Sure, sir. And the benefits of the HPDC technology?
That's what we said, that it's a much smoother supply with less rejections and much more mechanical controls.
Sure, sir. Thank you.
Thank you. A reminder to all participants, you may press star and one to ask a question. Ladies and gentlemen, the next question comes from the line of Ashok Shah from Eklavya Invesco. Please go ahead.
Thanks for taking my question. Sir, can you just explain the future of the EV scooters in a scooter market or a bike market as we are planning for the we are doing for the EV also?
Can you repeat?
Sir, can you repeat it? There was a blur in the voice.
Yeah, it's okay. Yeah. Sir, we are doing a supply also to EV scooters. So due to the cost-effectiveness, the market of the EV scooter will increase and overtake, over the next five years, the normal scooters and bikes.
So that we can't say that you need to ask the EV manufacturers, but we wish that it increases. We had expected it to increase further, but I think there is a price gap, and they are losing money on that same price. So I don't know. We can tell the statistics that it is less than 5% of the total market.
What's our supply to the EV market currently in our total bike?
We are also the same ratio. We are supplying to the EV players, all EV players. So we are fully hedged. Whether the ICE grows or the EV grows, we are supplying to everyone. So it doesn't make a difference to us.
Okay. Thank you, sir. Thank you, sir. Thank you.
Thank you.
Ladies and gentlemen, that was the last question for today. I would now like to hand the conference over to Mr. Kuldeep Singh Rathee, Chairman and Managing Director of ASK Automotive Limited to give his closing remarks.
Thank you, ladies and gentlemen. Thank you for such patient hearing. I will only say that we'll keep on working the way we have been working in the past, and hopefully, we'll justify our performance in the times to come to the market. One thing we forgot to mention is that this year we improved our ROCE with the capacity utilization from INR 23.64 crores- INR 27.5 crores. I may assure you that next year also we'll be doing very well and will be achieving a ROCE close to this with the debt-to-equity also further improving and the performance going on a very sound footing. That's what we will make all our efforts to justify our performance, and we'll be in touch every quarter. Thank you very much for your patience.
Thank you, sir. Ladies and gentlemen, on behalf of ASK Automotive Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.