Steel Strips Wheels' Mehsana plant to contribute 25% of total revenue ahead; secures long-term order

The order is long-term starting May 2020 and will spread over the coming years till 2024-2025.

Jul 03, 2020 04:07 IST India Infoline News Service

Steel Strips Wheels
Steel Strips Wheels (SSWL) has prepped to strengthen its alloy wheels business ahead, as the company bagged a huge order for its Mehsana plant. The order is long-term starting May this year and will spread over the coming years till 2024-2025.

The company informed, "The total visibility of the order book for coming 5 years comes to approximately Rs3,750cr".

SSWL in a filing to exchanges said, "The supply programs are signed off and the ramp-up plan is already shared earlier till Mid of next year and regular update of the same will be provided on a half-yearly basis on the further ramp up".

It added, "This gives immense confidence to SSWL to expand its capacity of Alloy wheel plant in Mehsana to support the volume visibility of consumer program".

Further SSWL mentioned, "the volume growth has the assumption of having the expanded capacity of SSWL Mehsana plant coming onstream in FY20-21 end, and the capacity will be 3 million (30 lakh units) at the end of FY20-21 to meet committed volumes to customers”.

Also, the Mehsana plant is seen to contribute towards its guidance of improving the group level EBITDA/ROC/Leverages.

"We expect Mehsana plant to contribute close to 25% to total revenue going forward coming into full phase production," said SSWL.

With 3M capacity, SSWL believes that they have the potential to generate a turnover of Rs1,100cr per annum, thereby, generating a huge economy of scale multiplier to its operational efficiency.

On Sensex, SSWL stock ended flat at Rs432.20 per piece. 

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