Ladies and gentlemen, good day and welcome to SJS Enterprises Q4 FY 2024 earnings conference call hosted by JM Financial. 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 the star then zero on your touchtone telephone. Please note that this conference is being recorded. I now hand the conference over to Mr. Ronak Mehta. Thank you, and over to you, sir.
Thanks, Steve. Good morning, everyone. On behalf of JM Financial Institutional Securities, I welcome you all to this Q4 FY 2024 earnings call of SJS Enterprises. From the management team, we have with us today Mr. K.A. Joseph, Managing Director and Co-founder, Mr. Sanjay Thapar, CEO and Executive Director, Mr. Mahendra Naredi, Chief Financial Officer, and Miss Devanshi Dhruva, Head Investor Relations. As we do always, we will start the call with a brief opening remark from the management, followed by Q&A session. With that, over to you, Devanshi. Thank you.
Thank you, Ronak. Good morning, ladies and gentlemen, and thank you for being with us over the call today. We appreciate it. Moving on, this is how we intend to take today's conference call forward. I will pass on the dais to Mr. K.A. Joseph, our MD and Co-founder, who will make his opening remarks. Then he will hand it over to Mr. Sanjay Thapar, our CEO and Executive Director, who will take you all through some of the slides of our presentation that has been uploaded on the stock exchange as well as on our website.
Sanjay will take you all through the industry view, our business performance, and also give a strategic outlook for the future growth of the company at the end. Mr. Mahendra Naredi, our CFO, will update you all on our financial highlights, post which we will open it up for Q&A. Thank you once again, and I will now hand it over to Mr. Joseph to make his opening comments. Over to you, Mr. Joseph.
Thank you, Devanshi, and hello and good morning, everyone. I trust you all had a chance to look at our investor presentation and the results published yesterday. While Sanjay and Mahendra will take you through the presentation later, I would like to quickly share some updates with you all. In FY 2024, the overall business scenario in India has been robust, with the country being one of the fastest growing major economies, achieving a remarkable growth rate of 7.8%. While the global economy continued to face headwinds and geopolitical disturbances, high inflation and tighter monetary policies, we have had some impact on businesses. The domestic economic activity continues to expand at an accelerated rate, supported by increased consumer spending, strong domestic demand and consumption in our industry. During the year, we have completed the transformative acquisition of Walter Pack India.
The Walter Pack acquisition has opened up a plethora of new opportunities for us. With this acquisition, we have penetrated deeper into the passenger vehicle segment and consumer segment as well, thereby further reducing our two-wheeler dependence. As a result, in FY 2024, we saw a balanced contribution from passenger vehicles, two-wheelers, and the consumer segment. Now, coming to some of the key updates. For the 18th consecutive quarter, SJS has delivered a better than industry growth, primarily on the back of Walter Pack acquisition, coupled with a strong performance across segments. I am pleased to inform you all that in Q4 FY 2024, Walter Pack saw a strong recovery in its business as key OEM volumes picked up. EBITDA margins reached 25.5%, a significant increase from 20.4% in Q3 of FY 2024.
The order intake for Walter Pack also has been substantial, reinforcing our positive outlook on Walter Pack's growth trajectory. Furthermore, Exotech recorded EBITDA margin of 18.1%, underscoring our commitment to operational excellence and profitability. I am also delighted to announce that for the fourth consecutive year in a row, our company was recognized as a Great Place to Work in the midsize organization category, highlighting our commitment to excellence. Last but not the least, I am very happy to inform you all that as a reward to our long-term shareholders, for the first time since our IPO, the board of directors have recommended a final dividend of 20% on the face value.
As we move forward, we remain focused on delivering quality products to our customers and building long-term relationships with all our stakeholders. We are dedicated in advancing innovations, maximizing efficiency, and strengthening core businesses, while also looking at the new prospects of markets for growth. With that said, I would like to now hand over the call to Sanjay to take you all through some of the businesses and industry highlights for this quarter. Thank you, and over to you, Sanjay.
Thank you, Joe. Hello and good morning, everyone. Talking of Q4 and this financial year gone by, Q4 FY 2024 was marked by yet another quarter of better than industry performance by SJS, with a consolidated revenue growth of 75.3% year-on-year to INR 1,867.9 million, compared to 22.8% YoY growth in the automotive, two-wheeler and passenger vehicle production volumes. This growth is primarily attributed to the successful integration of Walter Pack India, along with the enhanced performance of our businesses in the passenger vehicle segment, consumer business, and exports. During the quarter, automotive businesses drove growth for us both in the domestic markets, at 75.6% YoY, and export markets at 40.3% year-on-year.
On back of robust margin performance delivery both by Walter Pack and Exotech, I am delighted to share that the consolidated EBITDA margin for the quarter improved 70 basis points quarter-on-quarter and 147 basis points year-on-year to 26.2%. At the end of quarter four FY 2024, the company generated strong cash flows of INR 756.2 million, and our overall cash and cash equivalents stood at INR 520 million. Our net debt reduced to actually INR 163.5 million on account of our very strong cash flow generation. In terms of production volumes, the two-wheeler industry grew by 26.4% year-on-year in Q4 of FY 2024, with SJS's consolidated two-wheeler sales outpacing this growth at a growth rate of 44.3%. The passenger vehicle segment experienced even more significant growth with a 105.3% increase over the same period, surpassing the industry's growth of 9.7%.
This remarkable growth in two-wheeler sales was primarily due to new business acquisitions, while the growth in the PV sector was largely attributed to our recent acquisition of Walter Pack India, which has expanded our PV business within the automotive segment. Overall, SJS in Q4 FY 2024 consolidated automotive sales saw substantial year-on-year increase of 73.5%, with organic growth from SJS and Exotech's automotive business at 35.3%. Again, higher than the industry growth rate of 22.8% during the quarter. Simultaneously, for FY 2024, automotive industry, two-wheeler and passenger vehicle grew by 9.7% year-on-year, while SJS consolidated automotive revenue grew by 38.3% year-on-year, demonstrating around 4x industry growth rate and organic growth was at 19.7% year-on-year. I am extremely delighted to announce that for the full year FY 2024, SJS has achieved its stated guidance of 45% revenue growth and has exceeded it 30% + PAT growth excluding amortization expenses.
Revenues at INR 6,278 million grew 45% year-on-year, primarily on back of Walter Pack acquisition and the strong performance across all business segments. EBITDA grew 36.9% year-on-year to INR 1,599 million, and with an EBITDA margin of 25.2% and our PAT grew 26.9% year-on-year to INR 853.7 million with a PAT margin of 13.6%. Our PAT excluding amortization expenses grew 37.1% to INR 921.8 million with a PAT margin of 14.7%. The growth prospects in the PV segment are promising, especially post the Walter Pack acquisition. Walter Pack India is proficient in IMD, IMF, and IME advanced technologies, generating almost two-thirds of revenue from passenger vehicle segment.
Our strategy to diversify across various product categories and multiple industry segments, coupled with our very strong broad customer base, has effectively helped us mitigate the impact of industry slowdowns in specific areas and regions during the year. On the exports front, we have seen significant growth of 57.2% year-on-year during the quarter. Overall, for FY 2024, we saw robust growth of 51.1% in exports to INR 483 million. The increase in export revenue this quarter is primarily attributed to the gradual recovery of revenues from North America and Europe. Our export initiatives are progressing steadily. Additionally, we have appointed a sales agent in South Korea to further enhance our presence in the East Asia region.
We continue to expand our share of wallet by winning new businesses from key customers like Mahindra, Tata, Škoda, Stellantis, Legrand, Whirlpool, Honda Motorcycles, TVS, among many others. We've also added Mintec as a new customer, and I hope to strengthen our relations with them even further. Before I hand over to Mahendra, I would just like to give you a quick update on our ESG and the CSR front. On the ESG front, our company is making great efforts to reduce our carbon emissions, hence we are in the process of adding around 6 MW of captive solar power across our facilities. This strategic move is expected to yield cost efficiencies while significantly reducing our carbon footprint. It is noteworthy that our Bangalore facility already meets around 95% of its energy needs through renewable sources.
We are now extending this sustainable energy initiative to our other facilities, aligning with our commitment to environmental stewardship. Almost 75% of our consolidated power energy requirements across all facilities will soon be met by green energy. At SJS, we are also committed to fulfilling our corporate purpose while delivering long-term benefits to society. With regard to environmental, social, and governance metrics as essential for assessing our success, our ESG principles are firmly integrated into our board's governance framework, guiding our organization towards sustainable growth and protecting stakeholder interests. Through our corporate social responsibility programs, we strive to contribute positively to the societal well-being.
Furthermore, our ongoing efforts in diversity, equity, and inclusion have achieved substantial progress in enhancing our organizational culture. It is satisfying to note that our contributions of CSR activities throughout the year are helping improve lives of thousands of people and the environment in a positive manner. I would now like to hand over the call to Mahendra Naredi, our CFO, to update you all on the SJS financial performance before I come back to talk on our future growth outlook. Over to you, Mahendra.
Thank you, Mr. Thapar. Good morning, everyone. Let's delve into the financial snapshot. Slides 12 to 15 provide a concise overview with Slide 14 focusing on the organic performance of SJS and Exotech, and Slide 15 presenting the consolidated picture including Walter Pack India. In Q4, our consolidated revenue reached INR 1,867.9 million, showcasing growth of 75.3% year-on-year. This robust performance is attributed to the inclusion of Walter Pack India addition and strong contribution from passenger vehicle, consumer segment, and export business. Organically, our revenue grew by an impressive 35.9% on YOY basis, much higher than the industry growth. Moving to EBITDA, we achieved INR 495.3 million, marking a YoY growth of 82.2% with a margin of 26.2%, improvement of 70 basis points quarter-on-quarter in quarter four.
EBITDA margins was mainly driven by Walter Pack India's significant jump from 20.4% in quarter three FY 2024 to 25.5% EBITDA margin in quarter four FY 2024. Excluding Walter Pack India, organic EBITDA for SJS and Exotech stood at INR 372.5 million, boasting a healthy margin of 25.5% and a YoY growth of 37%. EBITDA margins have shown a positive trend, improving by 75 b ps YoY, primarily due to superior margin performance of Exotech at 18.1%. Our consolidated PAT for the quarter stood at INR 271.8 million, demonstrating a robust YoY growth of 76.6%, with PAT margin standing at 14.5%, improving by 11 b ps YoY and 156 basis points quarter-on-quarter, primarily due to higher EBITDA margins. Organically, PAT growth stood at 48.5% YoY to INR 228.4 million with a healthy margin of 15.8%.
This growth was driven by higher EBITDA, offsetting the impact of lower other income and increased finance cost. Our full- year FY 2024 performance has already been mentioned by Mr. Thapar, that we are extremely happy to inform you that we have achieved our guidance of 45% of revenue growth and 40% of PAT growth, excluding amortization expenses on the intangibles. Our consolidated ROCE during the quarter stand at 20.4% and ROE, return on equity, at 15.2%. ROCE was lower due to Walter Pack India acquisition, and this will improve gradually over a period of time and with better utilization of investment over next one to two years. At the end of FY 2024, the company achieved robust free cash flow of INR 756.2 million and our cash and cash equivalent reached INR 520 million.
During the quarter, SJS for the first time had raised a long-term debt, and our net debt increased to INR 683.4 million due to Walter Pack India acquisition. However, as promised to you all, a significant portion of the debt will be repaid or adjusted by the cash by the end of FY 2024. So now our net debt level stand at INR 163.5 million, reflecting our strong cash flow performance. The existing cash levels are mainly for working capital requirements. With the acquisition of Walter Pack India, we are becoming more future ready as our new generation product contribution increased to 25.2% of our consolidated revenue during FY 2024 from 9.4% in FY 2023. Walter Pack India acquisition has effectively balanced our portfolio across two-wheeler passenger vehicle and the consumer segment in the right manner.
During FY 2024, exports recovered in a strong manner and witnessed growth of 51.1% YoY basis to INR 483 million. FY 2024 exports constitute 7.7% of total consolidated sales. Both Exotech and Walter Pack are primarily domestic business, and hence export as a percentage of consolidated sales is at 7.7%, while exports are 12.7% of SJS standalone sales. I would now like to hand back the call to Mr. Thapar to discuss about our future plans and growth outlook.
Thank you, Mahendra. Moving to our outlook for future growth. In FY 2024, our company has significantly outperformed the industry growth rate thanks to our strategic initiatives. We are set to continue this trend, growing at least 1.5 x faster than the underlying industry growth. We already have visibility of over 85% of our FY 2025 order book in hand. This success is driven by a broad market reach, diverse product lines, and very strong partnerships. Our strategic acquisitions have increased our current content per vehicle in passenger vehicle segment over 10-folds in the past two to three years, establishing us as a key supplier to the four-wheeler segment. In FY 2024, we have delivered on our commitments, driving substantial growth. We remain focused on enhancing product aesthetics, expanding globally and maintaining a strong margin profile, solidifying our market leadership.
We have been continuously defining and delivering on our growth strategies, and this is reflected in our robust financial performance. We are optimistic and extremely confident that we are moving ahead in the right direction. With a formidable array of products in our arsenal and diversified customer base, we will consistently keep outperforming the industry. With that said, I come to the end of my quarterly updates. Thank you. And now we are open to questions, if any.
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 touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset 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 Abhishek Jain from AlfAccurate . Please go ahead.
Thanks for the opportunity and congrats for a strong set of numbers. Sir, consumer segment now contributes 20% of revenue, and you have won many-
Sorry to interrupt. The current participant has been disconnected. The next question is on the line of Amit Hiranandani. Please go ahead.
Many congratulations to the SJS team for a strong set of numbers. Sir, my first question is basically, if you can please help me with the Exotech and WPI FY 2024 revenue EBITDA PAT number and the total CapEx for FY 2025 and 2026, including all the expansion related CapEx for WPI and Exotech, please.
Thanks, Amit. We already have disclosed our organic sales. Particularly, you asked about Exotech. For the quarter, Exotech is INR 44 crore revenue, and for Walter Pack, we have INR 48.5 crore turnover.
Sir, for FY 2024 full- year?
Full year basis, for Exotech, we have achieved INR 156 crore, and Walter Pack full year, because Walter Pack is only for consolidation for nine months. So full year basis, for nine months, it is INR 119 crore.
Sir, similar EBITDA number, can you share for both the companies?
We will not be able to share the EBITDA number. We have given the sales number for your better understanding.
Sure. Sir, total CapEx for FY 2025, 2026, including expansion related.
For the next year, CapEx, like we already said, we will have our maintenance CapEx, plus we will invest into our expansion, especially for the cover glass as well as for plating shop. We expect that in this current year, FY 2025, we will do a CapEx of in the range of around INR 60 crore to INR 70 crore. But if I talk about for a larger, for the two or three-year basis, the CapEx would be in the range of INR 160 crore, INR 170 crore.
We see a lot of traction in our business requirements from customers and also the new opportunity on cover glass that we are working on. Primarily, it is all related to this huge growth opportunity that we see for the company.
For the FY 2025, INR 70 crore CapEx, can you break it down, please? Like where we are going to spend it on Exotech and WPI?
Roughly, you can say, maintenance CapEx in the range of INR 20 crore, and the rest will be for expansion.
My second question is on the cover glass side. If you can help us understanding more about the cover glass, what is the industry size or opportunity, how much it is presently getting imported, what steps we are taking to increase the production, target customers, and how much revenue possibly we can achieve annually for this cover glass.
As we have said in our earlier calls, this is a progressive adoption of the integrated display screen in cars. As we have said earlier, this is still at a nascent stage. This business adoption is happening. Currently, all the cover glasses and all the center stack displays that you see are imported. It is difficult to size the market currently, because it would depend on the adoption rate by the OEMs. Largely, let me explain to you. Already you would have seen many cars in the country with the large display screens. Of course, depending on the category of the car, you have a larger or a smaller screen. What seems to be clear is that the direction OEMs are headed and what is demanded by the end consumer is a display screen, which can have all the driver information at one glass.
And that is the business that SJS is focusing on. So we will not make the display screen per se, but we will make the cover glass that comes on top of it, which gives you some very special properties like anti-reflection, anti-glare, anti-fingerprint. So it's a very critical component, and the market is still evolving.
Hello, Mr. Amit. Does that answer your question?
Yes. Sir, just last one question. Is there any further surprise possible in the Exotech's margin for the coming one to two years?
Surprise, I would take it that you want positive surprise, right?
Yeah.
We always maintain a guidance that Exotech is a plating business. While we are a very efficient company, we try to reduce inefficiencies to the extent possible. Our guidance always has been that we will be around 15%-16% margin for Exotech. We have outperformed that expectation this quarter, but the normal expectation from this business should be in the same region of 15%-16%. I still maintain that guidance. Of course, our efforts are to keep improving.
Okay, sir. All the best. I will come back in the queue. Thank you, sir.
Thank you.
Thank you. The next question is from the line of Yash Agarwal from IIFL Securities. Please go ahead.
Hi. Congrats on a great set of numbers. I just had a few questions. The first one being on the exports opportunity. How do you look at exports from WPI and Exotech going forward?
I think we are extremely optimistic. The reason being that the product portfolio that we had earlier at SJS was primarily two-wheeler focused, but with Walter Pack, we have IML, IMD, and chrome plated parts at Exotech, and all these are products that are actually used by all OEMs globally. We are in discussions with customers across the world, and we are extremely optimistic of the prospects of exporting these products.
Okay. The next question on the raw material cost in case of the standalone business. The RMC costs have gone up 320 bps quarter on quarter. Is there any specific reason attributable to the same, and what would be your guidance going forward?
Not really. Fundamentally, quarter on quarter, depending on the product mix, the RMC would change a little bit here and there, but nothing very significant. Especially in this quarter, we made a provision for some slow-moving stock that we have because we make a large amount of variants in the company, so close to about 7,000 SKUs, and the customer demand sometimes changes. These go as some spare part at some point in time. But as prudent management, we do make a provision for slow-moving stocks that we have in our inventory. This is a routine provision made. That has accounted for this RMC increase or marginal, very small increase that you see.
Okay, got that. Lastly, on the opportunity in case of the optical cover glass. How do you see revenue panning out in the next two or three years? What will be the size of the plant, and how much revenue do you aim to clock out of the same?
Fundamentally, our view is that all cars in India will have an optical display. What is the time frame which will happen depends on the adoption rate by the OEM. The price point of this display could vary depending on the size of the display. I would imagine that from a cover glass content would be roughly from maybe INR 700 a vehicle to go up to close to about INR 4,000 a vehicle. Depending on the size of the display and the complexity of what they want. Therefore, that is the broad guidance I can give you. You can do your math. It's a very sizable market. We are engaging with customers for more than two, three years now. Prototypes have been given.
We are in this process of winning this business, which we've said in our earlier call, over the next quarter or two quarters, we hope to win this business. We are earmarked investments for a new facility that we will set up for this cover glass, and we expect this to be a very significant growth driver in the next three to four years.
Okay. That answers all my questions. Thank you.
Thank you.
Thank you. Before we take the next question, ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to two per participant. Thank you. The next question is from the line of Ajox Frederick from Sundaram Mutual Fund. Please go ahead.
Congrats on a very good set of numbers. Sir, I have two questions. One is on Exotech. You mentioned that the capacity plan for the year is around INR 60 crores. But during our earlier interactions, we mentioned that Exotech's capacity needs to be improved. I think we will run for about INR 200 crores of revenue. When are we planning on a decent expansion in that space? That is point number one. Point number two, since we are guiding for a 15%-16% kind of margins, what exactly is sustaining this 18.5% or 18% + margins for 3 Q and 4 Q? Those are the two questions on Exotech. I have one more on the standalone business.
Exotech, as we said, we see good traction. We see a large export market. As I said, this was a business that we acquired three years ago. We have increased revenues, we doubled in revenues, we increased EBITDA margins. We have done everything that we could. We have a legacy set of customers that we need to serve, which we are serving. What I said is, what will drive EBITDA margins moving forward is going to be the export market or the new customers that we acquire, which will benchmark selling prices to what exists in the export markets. The realization in export markets for chrome plating parts is much higher. Till the time that becomes a reality and a significant part of our Exotech sales, I am a little shy to give you a guidance beyond 15%, 16%. As a manufacturing-focused company, we focus on lean.
We constantly focus on driving down waste and muda from our business' operations. Operations efficiency focus is what has driven margins in the last quarter. There's no secret sauce to it. We just work hard to make sure that we reduce rejects, we increase throughput, and we optimize the utilization of existing capacity that we have. That's what we've done, and which we'll continue to do across all our businesses. We are very closely focused on profitability, and we monitor it very carefully. I'm sorry, there was another question saying when will capacity at Exotech will come on stream. Is that the question?
Yeah. Will this be enough for the capacity expansion, the INR 60-70 crores for the year for Exotech?
Yes. Two years ago, we acquired a piece of land. Then we said that we are going to expand capacity for Exotech because we saw very bright future and demand from customers. But, after the acquisition of Walter Pack, we announced to the market that we are going to club the requirements of both these companies and do frugal investments. That is what we are doing. Creatively, we've unlocked capacity by better capacity utilization, and then we have also mopped up or entered into partnerships with some plating companies nearby to our plant, where we have utilized their spare capacity.
We have the marketing strength and the wherewithal. We maintain a very tight supervision over quality, and we've been able to add supplementary capacity without really spending money. That's I think the smart way of doing this business. But we will, this year, also invest in another plating line for Exotech, which will be very well cost-engineered, and that is what we are working on for the current year.
Got it, sir. That's helpful. The other question I had is on SJS standalone margins. Sir, you mentioned about this RMC provisioning, and if I go back in Q4 FY 2023 also, we had a lower margin. Is there a seasonal Q4 phenomena where we try to write off some of the products where we are not seeing good movement, and then we see a bounce back in the subsequent years? Should that be the case, or how should we read that margin dip and going forward?
Frederick, that is not something usual. It is depending on the facelift by the customers. Yes, in Q4, the two-wheeler customers have a facelift, and henceforth, we have created this provision. It's not as usual. It's not something that belongs to the Q4. It's depending on the strategy of the customer. I would say this is kind of a one time in this quarter.
Okay. You were talking about this moving into spares, which means that Q1 can be slightly better than the usual run rate of margins. One this-
No. Let me clarify. We don't sell spares to the auto market. When I talk of spares, we sell it to the OEM. What happens is that with the population of vehicles on the road, there's a demand that the OEMs have for their spare part requirements. So nothing goes obsolete. Now they have sporadic requirements of a blue color, a red color for model A, model B, model C. So we don't scrap this material per se because somewhere or the other something is utilized. But not everything can be utilized. Therefore, I think provision for it.
Got it, sir. So slightly longer-term visibility on the margins. If I look two years ago, we were doing 31%, then we came to 30%. Now we are at 29%. I know it's marginal movements. But will the trajectory continue like a 1% kind of further for steady state margins or 30%, let's say two, three years down the line for standalone SJS?
So what I've maintained forever is really that don't look at us as sum of the parts. So we have integrated strategy. There's a rationale behind acquiring Walter Pack and Exotech. There are some products and some processes that are fungible. We can offer a customer product A, product B. So depending on the competition intensity, depending on the price point or expectation of the customer, we offer one or the other. So I know that you analysts would like to analyze it slice by slice. Think of it obviously as a larger company. So on a larger perspective, what I've said is we continue to drive growth, outperforming the market, and maintain an EBITDA margin of close to 25%. So that is what I have stated on many occasions, and we are absolutely on track, demonstrating performance on the same lines.
Understood, sir. That's very helpful, sir. Again, congrats on a good set of numbers. Thank you. That's it for me.
Thank you.
Thank you. The next question is from the line of Abhishek Jain from Alf Accurate. Please go ahead.
Thanks for the opportunity. Are you able to hear me?
Yes, we can. Loud and clear.
Yeah. Sir, the consumer segment contributes around 20% of revenue, and you have won many business in all three segments. So if you can throw some more light on the new business win in the consumer segment, and how would be the revenue mix in the coming years?
I had a little difficulty hearing you because of an echo on your end. What I understood is that you want to understand, what is driving growth in the consumer segment. Is that the question?
Yes, sir. Yes, sir. Consumer segment, what are the new business wins?
Yeah, okay. What we have done is that we've added Reliance as a customer. We have acquired the Legrand business as a part of our consumer-facing businesses, thanks to the acquisition of Walter Pack India. We've added a complete new vertical. Consumer electricals was not a part of our consumer business, so we've added that, and that has given rise that consumer today accounts for 20% of our sales pie. In addition to that, we've added Reliance, as I said earlier. We supply some products to them in large numbers. We've added Electrolux business for exports. We are doing Atomberg new business. Many new business wins for the consumer segment this year.
The current revenue mix is around 20%. How would be the mix going ahead?
I am happy with the mix that we have. We are 37%, 36% for two-wheelers, 35% for four-wheelers, and 20% for consumer. I think that is a very good mix, and it will continue to be the same. The consumer business could increase by about 1%, 2%, or these businesses could move 1%, 2%, depending on the overall scenario of what customer starts taking what products earlier. I would assume that we are looking at secular growth across all the segments. Largely this pie, I am very happy with, from where we were 70% skewed on two-wheeler business in FY 2019, 2020. To come to this stage, I think is very gratifying for us.
Okay, sir. In Exotech, the current revenue run rate is around INR 42.5 crores on a quarterly basis. Your total revenue at a peak revenue capacity is around INR 250 crores. When would you be able to achieve INR 250 crores kind of the revenue on an annual basis?
We are growing very strongly. As I said, we have debottlenecked that plant by doing some partnering with some companies. We are going to invest in a new line. I would imagine that this will come sooner than later. We do not really chase targets. It is the customers who are asking us to give them products. We see a healthy pipeline, and growth will continue on the same trajectory as it has done in the past. We are quite prudent in our forecast, and we feel that we will continue to grow.
Are we able to achieve a run rate of INR 50 crores on a quarterly basis in the near term?
No, you are talking in terms of capacity or in terms of-
Revenue.
Revenue. Revenue is a function of what new models get launched. We are forever discussing and adding new businesses. We will certainly reach that target. When will depend on how the market pans out.
I am sorry to interrupt, sir. I may request Abhishek Jain to please follow up in the question queue for further questions. Ladies and gentlemen, in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to two per participant. Thank you. The next question is on the line of Chirag Fialoke from RatnaTraya Capital . Please go ahead.
Hi, good morning. Congratulations on a strong set of numbers. Sir, I just had a couple of questions. The first one being, could you remind us what our current customer concentration is, including the impact of WPI? Approximately what is top five customers, what is top 10 customers, including WPI?
We don't give out the list of customers, as you can understand, for obvious strategic reasons. But what I can tell you is some percentages. Devanshi, you can just fill that in, please.
End customers would be somewhere around 70% to 75% of our consolidated revenues. But in terms of customer-wise, we will not be able to share any kind of details in terms of which customer and how much percentage.
Correct. Not customer-wise, but top 10 customers, including WPI at a consolidated level for the quarter were around 70%, 75%. Is that right?
70% to 75%, yes.
Could you share the same number for top five customers?
Customer, Devanshi, you can call out in percentage terms that was no more than so much.
Yeah. The largest customer for us on a consolidated level is not more than 14%-15%. So that concentration has also come down from earlier, which was around 20%. Now it has come down further to around 14%-15%.
Perfect. Thank you so much. Just one last question. Would love to hear the management's views on sort of the two-wheeler market overall. What are you looking at? How should we think about the medium term for the overall market? Where do you think it's headed? That's all. Thank you.
Yeah. The two-wheeler market has shown some resurgence in the last quarter, so there is good uptick of demand. Rural demand has come back, so companies are again optimistic. On overall basis, it remains to see how the market pans out, but we imagine that 8%-10% growth is what is likely, moving forward.
8%-10% volume growth.
That is the market growth. We, of course, will grow faster. What we have been maintaining is we grow at least 1.5 x of the market growth rate.
Wonderful. Thank you so much.
Thank you. The next question is from the line of Khush Nahar from Electrum PMS. Please go ahead.
Yeah. Thanks for the opportunity, sir, and congratulations on the very set of numbers. My first question was, apart from this industry growth that you are expecting, can you elaborate on which segments of which products would give us the extra level growth in the coming two to three years? My second question was on the competition. Given the attractiveness of the industry, do we see any competition in terms of our competitors providing a better or bigger basket of products like us, or are we still maintaining our market position?
Our market position, as I have maintained, is extremely unique. There is no company in India or no companies overseas also for that market, who has all the technologies and products that we have under one roof. We are a design to delivery company, so that maintains what it is. The second part of the question was, where will growth come from in the next three to four years? The point is, we will grow our cover glass business. That is expected to be a very significant part of the increased sales that we will do. The new technology that we have got at Walter Pack, IML, caps, logos, 2D emblems. All those are new products, and these products have large export potential as well, so we are exploring that business. Exotech, both the painting business and the chrome plating business, we see a very strong demand.
This is all in addition to whatever we currently do at SJS. As I said earlier, we see demand growing in all areas and all segments of our business. I called out these products because they are new technology products where we have a pole position and we hope that they will grow strongly. This is a function of what is the off-take by the customers, what is the adoption rate, but that is normal business for us. We have a very strong portfolio of products and technologies which can give us very strong growth in the coming two to four years.
Okay, sir. Thank you.
Thank you. The next question is from the line of Rohan Advant from Prad Capital. Please go ahead.
Yeah. Thanks for the opportunity and congratulations for a very good set of numbers. My first question is on Walter Pack. Walter Pack in the first three quarters used to average around 35 crores of revenue, ballpark, and in the fourth quarter we are at 48.5. I just wanted to understand that, based on the order book that you have, is this run rate sustainable or was there some bunching up of orders that happened, maybe some launches and that has stepped up the WPI quarterly numbers? That's the first question.
Yeah. Walter Pack, as we said, there was a model change at some key customers in quarter two, and that volume has since then come back, and that is the reason why we have grown revenues. Also in quarter four, we added some new products in Walter Pack, where we are in a very strong position, and that will lead growth. Coming back to is the trend going to continue? Yes, definitely that trend is going to continue because as I mentioned earlier, they are in a niche position in terms of the customer connect that they have. It's a very stratified segment.
Not many companies have the capability that Walter Pack has, and in fact, they're quite unique in that sense. The run rate for this company also is going to be similar to what we said overall for SJS. 1.5x industry growth rate is what we imagine, because of premiumization trend that we see. More and more vehicles use more and more premium products rather than standard products that they would use for aesthetics.
Got it, sir. Secondly, if you look at the EBITDA margins for WPI, while we've seen a very good pickup and we are now at upwards of 25%, WPI before acquisition had even higher margins, you know, 28%, 29%. Can we reach there sooner or later, or this is the new normal around 25%?
What I've said earlier is that, look, I think we have a very strong track record in terms of delivering EBITDA margins. I said that for SJS, and I'm saying that for Walter Pack. I'm happy with this 25%-26% sort of margin. What I am focusing now more on is growth of that business. We want to once off and do something similar to what we did after our acquisition of Exotech. The idea really is maybe very rapidly scale up the business. This is exactly what we are wanting to do at Walter Pack. Here, the advantage is that we have products where we didn't have too much competition. We are quite focused on growth for the moment. Margins will take care of themselves.
Got it. Sir, on a consolidated basis, we should look at strong revenue growth and EBITDA margins around the 25%-26%. Is that the right takeaway?
Yes. That's the right takeaway.
Okay. Thank you, sir, and all the very best for the next year.
Thank you.
Thank you. The next question is from the line of Pradyumna Choudhary from JM Financial. Please go ahead.
Yeah. Hi, sir. Congratulations on a great set of numbers. My first question is with regards to the cover glass, the new technology you have been talking about. Maybe I missed it, but can you give some idea regarding when are we expected, like what stage are we in in terms of whether we are getting RFQs and all, and when can we expect these to turn into orders for the company? Second would be on the Walter Pack side. Previously, I think we were still dealing with some cases of rejection and all. Has that business stabilized fully now? Yeah, these two questions.
Regarding the cover glass, just to underscore, it is a very complicated product. It has its own timeline in terms of validation, proving audits, and multiple audits. We have already received RFQs. We have given prototypes. The customers like it. We have given quotations, which are under commercial negotiation. We are in quite an advanced stage. But it is hard to give a guideline as to when the customer will award the business, because at the moment, all this is imported.
But we imagine that in the first half of this year, maybe as in the quarter or close to come to quarter, we should have the business, because that is around the time that we will start investing in this new plant also that we say. That mission will happen. We hope that in the next three years or four years, it should form a significant part of our turnover moving forward. That is what I [inaudible].
All right. On the Walter Pack side. Also, on the cover glass side, just a follow-up here. What could be a very brief top-down sense of what could be the possible realization in this and the kind of margins we can hope for? Then that Walter Pack question, whether the business has fully stabilized or are we still seeing some sort of ups and downs there?
Okay. For the cover glass business, it is of course, going to be a new business for us, new technology, but this is the first time an Indian company will start doing this. Margins could be low initially, because ultimately we will need to prove parts. We will do a lot of trials. Parts will not be sold to the customer. So on the RMC basis, maybe we will not be where we need to be, which is our target overall for the company. But the direction is very clear. So this is the area where competition intensity is less. I assume that in the long term, we will be able to get good profitability, phase-wise. So phase I could be lower margin, phase II could be better margin, phase III will be even better margin. So this is how it will space out.
As with any new technology product, once you launch it, a lot of effort goes into proving validation, internal trials, which don't earn revenue to you. So it's just learning to walk before we run. Coming back to Walter Pack. Yes. So we have improved that business. That is what is reflecting in the increased EBITDA margin that came through for this quarter. There are new products also that are being launched. Therefore, I'm saying that 24%, 25%, 26% sort of margins at Walter Pack is what we can expect moving forward. The emphasis, of course, would be accelerating growth there, both in the domestic and the export market for the product and technology that we have.
Understood. Sir, just one last question. When you say that our order book covers 85% of our revenue outlook for FY 2025. My understanding is usually in case of auto, the schedules shared by the OEMs is for the next one or two months. So when we are mentioning this order book, what's our assumption like? What kind of growth are we inputting for our end user industry?
That's what I said, 8%-10% overall growth for the industry is what we are looking at. Of course, we have some insights on specific models. So that depends on what will be OEM to OEM performance for different segments? Because we have a very large area of products. It's not just one part that we discuss. Therefore, I would still say that 8%-10% sort of growth is what we target in OEM volumes. Our sales, as I said, is going to be a little higher because our content per vehicle is higher, and adoption of these higher content products leads to outperformance of the industry in revenue terms when you look at SJS standalone revenues. No, not SJS. SJS consolidated revenues, sorry. Not standalone.
Understood. Thank you and all the best.
Thank you.
Thank you. The next question is from the line of Sukriti Jiwarajka from Laburnum Capital. Please go ahead.
Hi. Good morning. I just want to understand your product offerings and the resultant margins better. So of our current portfolio, could you highlight for me which particular products would sort of be the highest margin products? In these offerings, what sort of traction have we got, in terms of customers added, in terms of market share? Who do we compete with in the highest margin products? How has the overall competitive intensity evolved?
I will not be able to share with you individual product-wise margins for obvious reasons, as you can understand. But what I can say is that overall, we are not chasing volumes. We are in the area of high value-added products which add to customer appeal. So our margins are always on the higher end. To compare us with typical auto component companies, I think we are very well-placed, far ahead of most of them. And we are happy with that. Now, these are sustainable because the competition intensity for the product that we have is not very high. Earlier in the call, I had mentioned that we have close to about 15 type of technologies that we have under one roof, from styling to delivery. And that is a basket that no other competitor in India or overseas has to offer to the customer.
When anybody thinks of styling, we are the first port of call, or that's what I would like to believe. That we have a large workforce working on doing prototyping, and we do this pro bono for our customers to engage them and to give them a menu card of options of what products can we offer to them for specific vehicles or specific applications. It's a very long question. Maybe you need to understand our product portfolio a little better. But overall, it's a high margin business, where volumes are growing because there's a very strong tailwind towards premiumization. And the consumer is wanting better and better products. And these are what are the trends or the tailwinds that are driving growth in our business.
Got it. That's quite helpful. But overall, if I just take a step back for the same question, actually, chrome plating would be the only product in the mid-teens margin profile, and everything else I should assume would be at company level or higher, right?
That's right, because chrome plating is a process technology. If you have a chrome plating plant and you manage it well, you should technically be able to deliver the product. Of course, the differentiation between suppliers is that what is your customer connect, how strongly are you able to meet the quality, cost, delivery expectations of a customer, timely development, attitude, response time. These are normal matrices that the customers track. But yes, you're right. Chrome plating, when we acquired, was a 12% margin. Last quarter, we grew it to be an 18% margin.
My guidance is that it will continue to remain a 15%-16% margin. That's what you should expect. Unless I change my customer mix very significantly, which we are, at the moment, working on to get export business into Exotech. Then those margins would be better. But for historical reasons, yes, that is the only business in the mid-teen EBITDA margin range.
Got it. My second question is, any outlook on a slowdown in passenger vehicles? When you give the 8%-10% industry growth number, does this include any expectation of a PV slowdown, or was that only a two-wheeler guidance? Not even a guidance, just industry projection.
So we are a blended company. As you would see, 35%-36% of our sales come from two-wheelers and 35% from four-wheelers. So it is blended. When I say 8%-10%, it is overall. PVs could be 6%-7% because they grew very strongly last year. So there could be some effect of averages catching up. But we feel that new launches are going to come. The larger trend that is driving our growth really is premiumization.
So even though volumes may come down or volumes may not be maybe at 6%-7%, but the content increase will be much faster, and that's what we've been witnessing over the last two, three years. We've increased the content in a passenger vehicle from INR 80 that we had about four years ago to almost INR 10,000 now. So our volumes will grow. Within the PV market, of course, SUVs are growing. They are bigger vehicles, which require more number of parts, bigger parts leading to higher revenue.
Perfect. Thanks a lot.
Thank you.
Thank you. The next question is from the line of Ajox Frederick from Sundaram Mutual Fund. Please go ahead.
Hi, sir. Thanks for the follow-up. Sir, just a question on this content. Do you track content per vehicle per se, let's say two-wheelers, four-wheelers? If that is the case, how has that moved FY 2024 versus 2024?
There's no one answer to anything. Depending on the specific model, you have content constituted. An entry-level bike would have something; a premium bike would have a completely different set of parts. With the competition hotting up in the high-end segment, you have Triumph, you have Harley-Davidson, and you have all these other vehicles which are now. For us, when competition intensity increases in each segment, companies come to us to look at how to differentiate, and that's good news for us, and that's good business for us. But we don't supply all products to all models or all OEMs. Therefore, it's difficult to say, overall answer your question, to say how is the content increasing. It depends on vehicle to vehicle and OEM to OEM.
Got it, sir. That is for me. Thanks.
Thank you. Ladies and gentlemen, that was the last question for today's conference call. I now hand the conference over to the management for closing comments.
Hello. Yes. Thank you everyone for joining us over this call, and due to time constraint, if anybody's questions have been unanswered, we are happy to answer it. You can reach out to us over email or call, and we'll be happy to answer that. Thank you, everyone.
On behalf of JM Financial, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.