Ladies and gentlemen, good day and welcome to ASK Automotive's Q3 FY 2025 Post-Conference Call, hosted by Adf actors PR. As a reminder, all participants' lines will be in 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. Snighter. Thank you, and over to you, sir.
Thanks, Sejal. A very good evening to everyone, and welcome to the Q3 and nine month FY 2025 Earnings Call of ASK Automotive Limited. From the Senior Management, we have with us Mr. Kuldip Singh Rathee, Chairman and Managing Director, Mr. Prashant Rathee, Whole-Time Director, Mr. Aman Rathee, Whole-Time Director, and Mr. Naresh Kumar, 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 may involve risks and uncertainties, including those related to the future financials and operating performance of the company. Please bear with us if there is a call drop during the course of the conference call. We will ensure the call is reconnected at the earliest. I would now like to hand over the call to Mr. Kuldip Singh Rathee for his opening remarks.
Thank you, and over to you, sir.
Thank you. Good evening, ladies and gentlemen. It gives me an immense pleasure to welcome you all for our Q3 and nine month Financial Year 2025 Earnings Conference Call. Before I proceed, I hope you all have had the chance to go through the detailed presentation submitted to the exchanges and uploaded on our website. I am elated to be with you today evening to update you on our business performance for the third quarter and nine months ended December 31st, 2024.
I would like to begin by giving some insights on the industry update, followed by details of our business performance. As per SIAM report, the automobile sector, in terms of vehicle production across all segments, grew at around 6.4% in Q3 FY 2025 against the same period last year. Among all segments, two-wheeler posted production growth of 8% in Q3 FY 2025 and 13.1% in nine months FY 2025 on YOY basis.
The two-wheeler industry registered robust vehicle production volume of 5.9 million in Q3 FY 2025 against 5.5 million in the same period last year. The two-wheeler production in nine months FY 2025 was at 18 million against 15.9 million in the same period last year. India's stable policy ecosystem in 2024, building on the foundation of previous years, has significantly supported the automotive industry's growth. As 2025 begins with the optimism generated by the Bharat Mobility Global Expo, this positive momentum is expected to further accelerate the sector's progress in the coming years. I am now moving on to ASK business performance. I am delighted to share with you that we had a strong finish to the third quarter and nine months of the year in both revenue and profitability. This is the fifth consecutive quarter of robust performance by us since listing of the company last year.
During Q3 FY 2025, we delivered strong performance in business and recorded significant growth of 21% in revenue, 41% in EBITDA, and 32% in PAT on year-on-year basis. We have also continued to outperform the two-wheeler industry vehicle production growth in Q3 FY 2025. Further, I am glad that we have delivered the highest-ever EBITDA margin of 12.5% in Q3 FY 2025, which is 180 basis points higher than Q3 FY 2024. As a result of strong performance in Q3 FY 2025, our revenue has grown by 24%, EBITDA by 50%, and PAT by 51% in nine months FY 2025 on year-on-year basis. Our EBITDA margin stood at 12.2% in nine months FY 2025, with an improvement of 205 basis points on year-on-year basis. These strong results reflect the result of our continued focus on expanding value-added businesses, improving utilization of production capacities, and bringing cost efficiencies.
Our aim is to sustain this level of EBITDA margins and improve gradually in the subsequent quarters, depending upon the growth of the two-wheeler industry. With strong performance on profitability, our earnings per share in nine months FY 2025 has increased to INR 9.64 per share against INR 6.39 per share in the same period last year. Let me now go into further details of our performance on both revenue and margin sides. We have delivered robust performance in Q3 FY 2025 and recorded consolidated total income of INR 919 crores, which is 21% higher on year-on-year basis.
As a result, the consolidated total income for nine months Financial Year 2025 stood at INR 2,760 crores, posting a 25% year-on-year growth. All the three product segments continue to perform well and deliver robust revenue growth in Q3 Financial Year '25. We have sustained market leadership position in the Advanced Braking Systems business with 14% year-on-year growth.
The Aluminum Lightweighting Precision Solutions, our largest business segment, with 43% share of revenue, led the growth momentum and delivered 25% year-on-year growth. And Safety Control Cables also grew by 10% on year-on-year basis. We have recorded strong growth in our margins and profitability. Our Q3 FY 2025 EBITDA stood at INR 115 crores, recording 41% year-on-year growth, and nine months FY 2025 at INR 337 crores, posting 50% year-on-year growth. We have delivered PAT of INR 66 crores, with 32% YOY growth in Q3 of Financial Year 2025, and INR 190 crores in nine months Financial Year 2025, with 51% growth on year-on-year basis. If we exclude one-time deferred tax gain of INR 7.15 crores in Q3 of Financial Year 2024, adjusted year-on-year PAT growth is 54%, and in Q3 FY 2025, and 60% in nine months FY 2025.
I am glad to inform you that in nine months of FY 2025, we have achieved an EBITDA of INR 337 crores versus last full-year EBITDA of INR 311 crores in FY 2024. Similarly, in nine months of FY 2025, we have achieved PAT of INR 190 crores against the last full-year PAT of INR 174 crores in FY 2024. Now, let me talk briefly about the status of expansion plans of our production capacities. Firstly, our mega manufacturing facility at Karoli is expanding fast. The increased economies of scale and operational efficiencies are benefiting us in delivering better results.
Secondly, our 18th manufacturing facility at Bengaluru, incidentally, that's our third plant in Southern India, in Bengaluru, has commercialized on 14th January 2025. Thirdly, the solar power plant of 9.9 MW in Sirsa, Haryana for captive consumption started trial production on 27th January 2025, and will start supply of power soon.
Further, out of the union budget allocation of INR 1,110,000 crores for FY 2025 for infrastructure, a major portion is still unspent. Regarding the remaining portion of the budget allocation, we expect the government to spend in Q4 in a big way. Thus, the money shall percolate to the lowest level, including rural areas. This shall give a further boost to the sale of two-wheelers in the country. As we go forward, we are hopeful of maintaining the trend of outperforming industry growth in the subsequent quarter of FY 2025. We anticipate the growth momentum in the two-wheeler sector to continue for the remaining part of the year with prevailing positive market sentiment. Lastly, we are confident that we would continue to deliver strong performance in coming quarters and generate value for our stakeholders. With this, I open the floor for questions and answers. Thank you very much.
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. The first question is from the line of Sanjeev Agarwal from Avighna Investments. Please go ahead.
Good evening, everyone. Am I audible? Please confirm.
Yes, sir.
Sir, first of all, thank you for this opportunity. And I would also congratulate the team for achieving such a high EBITDA margin. This is definitely a one triggering factor for us as investors. Sir, I would like to know if you can help us with the EBITDA margins on the three-to-four product lines that we are having in our organization, which is advanced braking systems, vis-à-vis aluminum lightweight, which are the two main, and the other three as well.
Sanjeev, our EBITDA margins in all the three verticals are very close to each other. They are similar. So in good part is, as you said, that we could achieve the highest EBITDA margins by better capacity utilization because in the last two years, we invested very heavily. We invested INR 475 crores in the Karoli plant till date, and we are continuously investing up to INR 200 crores in the third plant, 18th manufacturing facility in Bengaluru.
Noted, sir. Thank you. Sir, the second question would be sir, can you please explain us a percentage between the EV versus non-EV that we are selling right now?
See, our percentage is similar because we are supplying to 80% of the OEMs in the EV sector. So the EV is total of EV percentage at the moment is only 5% of the total vehicle production in two-wheelers, and our outsource share of business is that.
Thank you, sir. That's all from the time.
Thank you. The next question is from the line of Joseph George from IIFL Securities. Please go ahead.
Thank you for the opportunity and congratulations on good numbers. Just two questions. One is the JV with AISIN Group, you mentioned that you're going to launch it in, I mean, in terms of the product launches that's going to happen in April 2025. What do I understand, how should we think about the scale of operations in year one in terms of maybe revenues or profitability?
Mr. Joseph, there was a very good response. We launched, we had an exhibition in the Bharat Mobility Expo, and there was an extremely positive response from the dealers all over the country. We are in the process of appointing dealers all over the country, and we hope to launch the operations in Q1 as we had always told before.
Okay. Any sense on how big the scale of operations will be in year one?
Oh, I think year one is always a start. As we progress in the quarters, maybe we'll give you some feedback after the H1.
Sure, sir. No problem. The second point I want to touch upon was the subsidy that is expected for the Rajasthan plant. I think earlier you had mentioned that it'll start flowing in from the end of FY 2025. Is that the status even now, and nothing has flowed in 3Q?
Oh, no, no. It has flowed in, and we could achieve all the conditions, and we have applied for the subsidy, and as I'm telling you, it has started from that Q3.
So some, I mean, some of that subsidy has already started accruing in Q3 itself?
Yes. It is about INR 6.65 crores subsidy from the Karoli plant in the Q3.
Understood. Thank you.
Now onwards, similar figure of around INR 7 crore will continue in the forthcoming quarters also.
Understood, sir. Thank you.
Thank you. The next question is from the line of Hitesh from HDFC Securities Institutional Equities. Please go ahead.
Yeah. Hi, sir. My question is, how do you see the two-wheeler demand shaping up over the coming months? And is there any concern of higher inventory-led production cuts by two-wheeler players? Because the export market pickup for two-wheelers is also gradual. So how do you see the production schedules of our two-wheeler customers shaping up?
Oh, I feel that the coming quarters, Q4 is very much sorted, and I'm an optimist on the two-wheelers very much. And I feel, as I mentioned in my presentation, that once this infrastructure spending is done, a lot of money is going to flow down the line, and they are the real customers of two-wheelers. And I feel positive even on the next FY.
No, sir. And one more question on what is the, how do you compare the difference in the content per vehicle of the ICE two-wheeler and the electric two-wheeler for our components?
EV component, because we are into very critical lightweighting and thermal management products. The EV. In EV, the component is higher. It's 30%-50% higher in the EV. So since we are agnostic, ICE agnostic and EV agnostic, so once the EV actually picks up, then I think our revenues will further grow.
Sure, sir. Thank you.
Thank you. The next question is from the line of Ronak Mehta from JM Financial. Please go ahead.
Hi, sir. Thank you for the opportunity, and congratulations on a good set of numbers. So I have a couple of questions. First is on the Karoli plant. Can you help us with the utilization level of the plant, and how do you plan to ramp it up further over the coming quarters?
See, the good part is, Ronak, that we have invested, we keep on investing, and as you know, the present status is INR 470 crore. So the utilization percentage is similar, about 45% to between 45% and 50%. But now the capacities are further ahead, and we expect that the coming years' growth shall be very much taken care of from there, as well as the new plant in the south in Bengaluru, which is our 18th plant.
Okay, so is it fair to assume that the asset turn for the plant, even on the new investment, will be about 2x-2.5x?
It's not 2.5x. We operate in 2x. Always we operate in 2x, and we definitely intend to achieve that with our lead manufacturing. We always aim for that.
All right. The second question is on the new Bengaluru plant. So have you started supplying alloy wheels? Can you just indicate who all are the customers? How do you plan to ramp it up? Any new order wins with respect to alloy wheels?
Oh, the commercial production has started. Some items of the existing product lines, which we were already supplying, they have started billing, but the new product lines are getting the QAV done. You remember in Karoli also, it had taken some time, one quarter at least we had taken, so that QAV is going on. I expect that all QAV to finish by March in this quarter, next two months, and from the next financial year, it should come on a good stream level.
Okay. And any new order wins on the alloy wheels business? Because you indicated last time that you were in negotiation with customers, and customers were doing trial runs. So any update on that?
I definitely said, because it's a safety item, the testings go on quite long. We are into the business of safety, and we have enough patience, and that takes little time. But we hope that some news should come by end of Q1 or sometimes in Q2.
All right. Okay. Thank you so much. Yeah.
Thank you. The next question is from the line of Basudeb Banerjee from CLSA. Please go ahead.
A couple of things. One.
Sorry to interrupt, Mr. Basudeb. I would request you to please use your handset.
Yeah. Am I audible?
Yes, sir. Please continue.
Yeah. A couple of questions. One, Honda announced their new EVs. So what kind of inquiries they were getting from Honda for coming quarters and such?
And basically, their plans are not very aggressive. The whole year plan for next year, they have taken only around 18,000. That's all. Yearly plan. One more model is also coming. One more model is also coming. They launch it in, I think, around Q2.
So you mean 1,500 per month from these two models? That's what they are aiming at?
Yeah. The first model. Second model, they'll give the different predictions. When they give it, we'll let you know.
Sure. And second, sir, now as overall European situation is not that great, and your outlook also corrected, so any new major orders or some progress you are making, is it going to be better from scratch? You have scope for expanding your exports outlook. If you recall, we were aiming at INR 300 crore exports revenue for FY 2027. So these challenging times definitely are acting as a hurdle. So how one should look at it?
And you are right, Mr. Basu. The things are not very rosy in the European sector. And on this particular, in spite of such good results, we would like to tell the investors that our exports may not grow this particular year because the customers, very prominent customers, they are first consuming the vast inventories in the pipeline. However, not to be getting totally disappointed, our Q4 is trying to be getting better than the Q3 and Q2 in exports. So maybe once they correct the inventories and better orders start. Second thing is we had also mentioned for the next year that we have got an export order of INR 100 crores for Ford Motor, but through Aptiv, but that is under testing. We have already given the samples, and once the approvals come, then that will start, hopefully, in the beginning of the next financial year.
All right. Another one, press release regarding aftermarket plans with the tie-up with AISIN where it was mentioned. So any specific strategy, timeline, revenue potential you were aiming at?
So as I just told Mr. Basu, that there was a very huge response in our exhibition in the expo in January, and we are in the process of making further dealers all over the country, and we'll be launching in the Q1 as was initially decided. And I hope the only thing we are trying to do is we are trying to break even in the first year. And if we do that, I think that should be a good achievement.
Last thing, sir, if I missed out, basically for a South Indian two-wheeler OEM trials were running for your new alloy wheel. So is it completely done and commercial production has started, or still the results are yet to be there?
Mr. Basu, since it is a safety item, the trials go on in various variants, and they are time-consuming, so I think we hope to receive the results by Q1 and/or maybe early Q2, and then only the supplies will start.
And as you said in one question in the call earlier that you have already commenced production, so can?
That plant is the complete ALPS plant, so it is not confined to alloy wheel. We can make anything and for any customer there, so the machines are like that, and there's a fungible line, and we are making various other products as a start. Then, because we have gone to the south, now we are getting some new orders also from various customers in the south because we have reached. Initially, we had exhausted our complete capacities in south, but now the customers have reposed confidence that we have come near to them.
Ladies and gentlemen, we have lost the connection of the current participant. Before we take the next question, a reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Kuber Chauhan from Anand Rathi. Please go ahead.
Yeah. Thank you for taking my question, and congratulations on good set of numbers. Most of my questions have been answered, but I want to know about your mix. How much the contribution was from EV, and how much was it from ICE for this particular quarter?
ICE, we have not yet launched, as I just said. ICE. Okay. So the ICE contribution is 76% in our business, and the EV contribution is about 5%.
Have we seen the trend moving? We saw a dip in this particular quarter.
It's moving as per the plans, as per the production per people. Yes, one of the largest manufacturers, his production levels went a little down. Otherwise, we were expecting even better performance in the EV.
Okay. Thank you.
Thank you. The next question is from the line of Naveen Kumar Dubey from Narnolia Financial Services Limited. Please go ahead.
Thank you for the opportunity, and congratulations on a very strong set of numbers, sir. I have a couple of questions. First one is related to your aluminum light-weighting product segment. So I want to understand what kind of potential market size this segment could have.
See, we have always said, Mr. Naveen, that the continuous focus in the motor vehicles industry, whether it is passenger car, whether it is two-wheelers, that's on lightweight. So I think the best material for lightweighting is aluminum. So we call it our sunrise sector, and we see huge potential in the sunrise sector domestically as well as in exports. And second thing is the more and more electronics coming in all the vehicles. So in electronics, aluminum being the very good conductor, there is a very. It's the best material for thermal dissipation, and there also it fits very well. So because of these two qualities, we see very huge growth in this. And as you must be noticing, that in nine months, we have grown 25% in this sector.
Yes, sir. Related to same, I think earlier it was more of an import substitute product. So any figure or any data related to that as what could be that import percentage, that aluminum product is imported in India? Any ballpark figure?
Oh, no. Aluminum is not getting imported. In fact, there are so many manufacturers for the last 30 years who are manufacturing here in nearby to our plants, and they are approved by the OEMs like Suzuki, Hero, and Honda, and we have to buy from them. So this is never. Yes, they do import the scrap. So that data, neither we have nor we feel the need to have.
Okay. A couple of questions related to, sir, any customer addition in the recent past, in the last one to two months? Is there any new customer getting added in your portfolio?
One customer added for export, but that's we got the orders, but the supplies, as per schedule, have to start in the Q3 of next financial year.
Okay. Q3 of next financial year. Okay. Because we had kind of INR 75 crores of order book for export, I think. Earlier, we had some.
Yes. We are still maintaining that we have that. That is already there, so that we are not mentioning.
Okay. Thank you, sir. If I have more questions, I will come back to the queue. Thank you.
Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Pradyumna Choudhary from JM Financial Family Office. Please go ahead.
Yeah. Hi, sir. Congratulations on a good set of numbers. My first question was on the aluminum lightweighting solutions vertical. So I just wanted to get a better sense of what the growth figures are. One would be related to the lightweighting happening on the EV side, but are we witnessing more and more aluminum being used even on the ICE vehicles? If you can just explain the growth figures here.
Yes. Even in the new vehicles, they are trying to make it lighter, so the more and more aluminum is getting used.
And also, the use of electronics is also increasing. So a lot of ECUs are all using aluminum as the preferred metal. And so just for a better understanding, would it be possible for you to quantify how much aluminum content has increased in new ICE vehicles versus older vehicles, and how much would be the increase in case of EVs?
This will be, I think.
This is very difficult.
This is very active at the moment. And plus, what we do is we keep on adding new products with our existing customers. So we are increasing our content, and that's our continuous endeavor to increase our business, even with our existing customers.
Who are we taking away the market share from when we are adding new products?
No, we don't inquire from the customer. When customer is in some requirement, then we do supply. That's what we do.
And so on the aluminum lightweighting side, your sense is over the next two, three years, we can continue growing that 25%-30% kind of number?
We have a good growth. That's how, as I said, that last 30 years, we have outgrown the industry, and we have grown in big teams. That's a record of not one day, but 30 years, and this year, now this year also, luckily, we are doing that, so I always say that we will keep on growing in big teams.
All right. All right. And lastly, if you can just quantify the revenue from non-two-wheeler segments, like passenger vehicle and commercial. What's the percentage of revenue? I know it would be very small. Just wanted to get some sense from passenger vehicles and commercial.
It's actually very small. That's to 4% of the export, which is in that two-wheeler is not there, and maybe 3% miscellaneous, 7%-8%, that's all.
Okay. Okay. Thank you, and all the best.
Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants that you may press star and one to ask a question. Ladies and gentlemen, you may press star and one to ask a question. The next follow-up question is from the line of Pradyumna Choudhary from JM Financial Family Office. Please go ahead.
Thank you. Thank you. Just another question. Apart from aluminum lightweight for the other two verticals, advanced braking system and safety control cables, we expect to grow in line largely with the industry, or even there are additional growth triggers?
So, brakes, we have always said that we are number one in the country with a majority share of business for the last 20 years. So we have to grow almost in line with the industry, except sometimes aftermarket grows in double digits. So that's in our hands. But otherwise, we grow with the growth of the industry. And regarding the other verticals, there's other two verticals, there's definitely a very good scope.
Okay. Okay. Thank you.
Thank you. Ladies and gentlemen, you may press star and one to ask a question. A reminder to all the participants that you may press star and one to ask a question. The next follow-up question is from the line of Naveen Kumar Dubey from Narnolia Financial Services Limited. Please go ahead.
Yes. Sir, what could be the CapEx for future, maybe next two, three, four years, if you can help with that?
So, Mr. Naveen, now the CapEx that we have made, as I said, we have invested INR 600 crores, and this will see us through for the next 18 months. However, whenever a new opportunity comes, we don't feel stingy on not putting the excess CapEx. Whenever we see the opportunity, we grab, and we don't mind doing more CapEx because whatever cash, strong cash we are generating, we always put it back in our new expansion, and that's how we keep on growing.
Okay. So maybe some INR 150 crore-INR 200 crore of CapEx.
I can't say the new opportunities keep on coming. So we don't shy away from investing. But the only thing is we are very, very judicious in investing, and I'm happy to share that last year we closed at a debt-to-equity of 0.42, and in spite of such heavy investment, we'll be most likely closing at a debt-to-equity of 0.38. And next year, further next year, our target is 0.3.
Oh, wow. Thanks, sir.
So we are very cautious in spending, but when the need and the opportunity arises, we just don't hesitate. We immediately spend it.
Oh, okay. Sir, one more question related to the Bengaluru plant, which is just started. I think what kind of cost increases can we see over the next two, three quarters? Because it will be in the initial phase.
We have plans to break even in the Q4 of next year. I think that will be pretty fast if we are able to manage that. We are confident that we should do that.
Sure. That's it from my side, sir. Thank you. Thank you so much.
Thank you.
And also.
Ladies and gentlemen, we will take this as the last question. I would now like to hand the conference over to Mr. Kuldip Singh Rathee from ASK Automotive Limited for closing comments.
Thank you very much, everyone. It has been a pleasure talking to you, and let me assure you that we remain optimists. We remain confident that we'll be performing and adding value to our stakeholders. Thank you very much for your patience, and see you and talk to you after in the next quarter. Thank you.
On behalf of ASK Automotive Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.