ECONOMY OVERVIEW
The Indian automobile industry has historically been a good indicator of how well the expansion and technological advancement. India is the worlds third-largest Automobile market after China and USA and also fourth largest Automobile producer in the world after China, the United States of America and Japan. The rising logistics and passenger transportation industries are driving up demand for commercial vehicles. Future market growth is anticipated to be fueled by new trends including the electrification of vehicles, particularly three-wheelers and small passenger automobiles.
Indias auto industry recorded a 7.3% increase in domestic sales from April 2024 to March 2025, with passenger vehicles having been the highest ever in Financial Year 2025, according to the Society of Indian Automobile Manufacturers.
The analysis of Automobile Industry in India Market size is estimated at USD 137.06 billion in 2025, and is expected to reach USD 203.25 billion by 2030, at a CAGR of 8.2% during the forecast period (2025-2030).
India is also a prominent auto exporter and has strong export growth expectations for the near future. In addition, several initiatives by the Government of India such as the Automotive Mission Plan 2026, scrappage policy, and production-linked incentive scheme in the Indian market are expected to make India one of the global leaders in the two-wheeler and four-wheeler market. The Governments initiatives such as introducing battery-swapping policy, expansion of Indian National Highways and adding advanced technologies including alternate fuel systems such as compressed natural gas (CNG), Bharat Stage VI compliant flexfuel engines, electronic control units (ECU) for safety, advanced driver assist systems and e-quadricycles, under the Production linked incentives (PLI) scheme for automobiles have attracted new investments and further provided a significant boost to the industry.
Industry Structure & Development
The Company expanded its business and has laid down Foundation stone on 13th May, 2024 for construction of new manufacturing plant in Kharkhoda. This new plant will provide capacity enhancement to meet the requirements of Maruti Suzukis new manufacturing plant at IMT Kharkhoda, which is expected to be commissioned in the financial year 2025-2026. The Company manufactures the plastic injection moulded automotive components i.e. bumpers, instrument panels, grills etc. as original equipments and for spare parts market primarily for Maruti Suzuki India Limited (MSIL) at two of its manufacturing locations in Gurugram & Manesar in the state of Haryana.
The company has put up tool room manufacturing for mould manufacturing, repairs and their refurbishment facilities in Manesar, Haryana for captive use and to service its customers in a cost efficient manner. The company has received positive response from the market.
The company has been dealing in all size plastic automotive components. The company has 63 nos. injection moulding machines, sizes ranging from 100 Ton to 3150 Ton clamping force. The company also provides job work facilities for Industrial Products like pallets, garbage bins etc. The company also manufactures moulds for in house requirements and others like MSIL, Daikin, VECV etc.
Opportunities & Threats
Indias rapidly growing market has already attracted all major automotive company to establish operations within the country. India is expected to emerge as one of the major automotive hubs on the global map in the near future. India could be a leader in shared mobility by 2030, providing opportunities for electric and autonomous vehicles.
The principal customer of the company is Maruti Suzuki India Limited (MSIL) and growth of the company currently depends mainly on the growth of MSIL. However, company does not have plant in Gujarat to cater to Suzuki Motor Gujarat.
MSIL continues to be the leader in Indian car market and has closed the financial year 2024-25 with domestic sales of 19,01,681 units and total sales of 22,34,266 units. Marutis domestic sales in 2024-25 represents growth 2.7% over 2023-24 and total sales in 2024-25 represents a growth of 4.6% over 2023-24.
Your company is actively working on expanding its operations to reach more customers.
The small to large size of machine range helps your company to cater to all types of customers part requirement. Moreover, the machines are versatile to process virtually all types of polymers and can make not only automotive but also other plastic goods by changing moulds. Thus, your company has immense capability to keep pace with the growing and diverse requirements of MSIL as well it has the possibilities for other business besides automotive.
The possible threats to the company can be:
Fluctuating Market conditions
Uncertain Monsoon Impacting Market Growth
Technological Disruptions
Reduction in market share of main customer
Rising Competitions and main customer policy of in house production of Bumpers and IP
Volatility in fuel prices
Sustainability Targets Influence Policies/ Government Policies
Limited Geographical presence at main customer all plant locations
Segment-wise or Product-wise Performance
Currently your company has single segment and it operates in manufacturing of injection moulding plastic components and moulds/dies and is trying to diversify its product and range of industry it caters to. Your company now also has capabilities in moulding smaller and intricate functional and aesthetic parts in automotive and other industries.
Your Company has also received tooling business from customers other than MSIL and making efforts in exploring alternate business opportunities in mould making and for replacement market.
Indian economic review
Amidst the global energy crisis and continued supply-chain disruptions, the automotive industry players are exploring options to reintroduce the sector. By implementing cloud computing and electric vehicles technology, the industry is entering fast into a revolutionized age with the primary aim of offering the consumer a value-added experience. The Financial Year 2024-25 automobile sales data shows the industry had a stable year.
India contributes 7.1% to global GDP through its automotive sector and ranks 4th in global vehicle production.
Despite a strong manufacturing base, India holds only 3% share in global traded auto components, highlighting a vast scope for expansion.
The Vision 2030 roadmap aims to scale production and employment.
Government schemes like FAME (Faster Adoption and Manufacturing of Hybrid & Electric Vehicle), PM E-Drive (PM Electric Drive Revolution in Innovative Vehicle Enhancement), and PLI have mobilized _66,000+ crore to support EVs and localization.
With targeted reforms and GVC (Global Value Chain) integration, India can raise its global component trade share from 3% to 8% by 2030.
India is on track to become the largest EV market by 2030, with a total investment opportunity of more than US $200 billion over the next 8-10 years. With demand still buoyant in the passenger vehicle segment despite challenges of commodity price increases, many automobile manufacturers are upbeat to embrace new technologies, especially in the electric mobility space, which is expected to witness a slew of launches in both four- and two-wheeler categories in the coming year.
Financial year | FY 19-20 | FY 20-21 | FY 21-22 | FY 22-23 | FY 23-24 | FY 24-25 |
GDP Growth (%) | 3.87 | (5.83) | 9.05 | 7 | 6.9 | 6.4 |
Outlook
The automotive outlook study has sized the global new vehicle sales in 2025 are expected to rise 1.7% year-over-year, to 89.6 million units, according to a new forecast by S&P Global Mobility. The automotive industry growth is influenced by various factors such as adoption of electric vehicles, development and manufacturing of long-range batteries along with installation of fast and ultra-fast charging points, introduction of autonomous vehicles and deployment of 5G connectivity. In addition, the automotive industry overview also covers several significant variables that have contributed to the used automobile, or preowned car, markets considerable expansion in recent years. The automotive industry is currently under constant pressure to adapt to new changes due to technological advancements and end-user preferences. Adoption of latest trends for customers is the foremost agenda of the OEMs and EV solution providing companies. Whereas, the study also focusses on the rising demand for electric vehicles, advancements in autonomous, 5G connectivity, smart & automated manufacturing, shared mobility and online sales of vehicles in automotive industry shaping the future market.
Dedicated to achieving zero emission targets, the OEMs have planned to invest over USD 500 Billion by 2030 for EV production facilities. Moreover, OEMs have attempted to regulate the EV battery supply chain to further cut down the raw material, manufacturing and maintenance of the batteries.
The capacity of automobiles to sense their surroundings, an autonomous or driverless vehicle can drive itself and carry out important tasks without the assistance of a human. It senses the environment and navigates by creating a dynamic 3D map of that environment using Light Detection and Ranging (LiDAR), Artificial Intelligence (AI) Software, Radio Detection and Ranging (RADAR), and Cameras. Most self-driving vehicles build and update an internal map of their surroundings using a variety of sensors, including RADAR. There are several degrees of autonomy, from fully autonomous to semi-autonomous, that require driver assistance. These vehicles also outperform traditional vehicles in terms of safety, fuel efficiency, and tra_c congestion & emissions reduction due to their lower gas & battery capacity usage.
Automotive Outlook Key development trends are as follows:
1. Connected car launches grew constantly across all regions.
2. Ride-hauling operators continue to diversify service offerings.
3. L3 automated driving features witnessed limited launches in 2023.
4. Rising adoption of EVs across all segments, reduction in battery prices, growth in charging infrastructures.
5. China dominating the automotive market.
Indian Automobile Sector
The automotive industry in India is set to expand at a compound annual growth rate (CAGR) of 11.3% till 2027. This growth will most likely occur due to factors like rising disposable income, wide availability of credit and financing options, and growth of population. Furthermore, with the growth of the passenger transport sector and the rise in demand for commercial vehicles, the potential for future growth of Indias automotive sector is pretty high.
A report by India Energy Storage Alliance estimated that the EV market in India is likely to increase at a CAGR of 36% until 2026. In addition, a projection for the EV battery market is forecast to expand at a CAGR of 30% during the same period.
Apart from this, industry-friendly policies and initiatives by the Indian Government will also play a major role in fueling this development in the years to come.
The future growth expected in the domestic automobile industry will give a fillip to the auto component sector. The Indian automobile industry as a whole offers great potential considering the low penetration along with rising income levels and a rapidly growing middle class. These factors will witness a boost in demand for passenger cars and two wheelers. With the automobile industry fast growing in terms of volume and number of players, your company foresees a bright future.
The Manesar Plant and new manufacturing plant in Kharkhoda of the company are now the focus area for all future growth of the company.
Risks & Concerns
The automotive market stands at a critical juncture as sustainability targets are exerting a significant influence on regulatory policies, driving organizations towards greener initiatives. As the industry sets out to bring in Electric Vehicles (EVs), manufacturers face the formidable task of overhauling their product lines and production facilities. This transition requires substantial investment in new technologies, charging infrastructure, and consumer education on electric mobility.
The automotive industry is many things, but it is never idle; it thrives on the pulse of innovation, resilience in hard times, and mobility transformation. Every year brings with it new shifts in technology, consumer behaviour, and market dynamics, all of which shape and build automotive as a cornerstone industry of the world. Now, as 2025 comes into focus, the energy is electric quite literally.
FAME India Scheme (Phases I & II): The Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme has been pivotal in promoting clean mobility in India. Phase II, with an outlay of _11,500 Crore, focuses on demand incentives for electric two-wheelers, three-wheelers, buses, and the development of public charging infrastructure. It also aims to promote technology platforms for EVs and create a robust domestic EV ecosystem.
Though India rides on some inherent strength, following risk factors exist which the auto component manufacturers may have to counter with:
Technological Disruptions & Consumer Demand: Consumer preferences and market dynamics are evolving rapidly in response to technological disruptions. The auto sector is experiencing rapid developments, including Electric Vehicles (EVs), ADAS and advanced connectivity features. Keeping up with these innovations requires substantial investment in research and development, infrastructure, and workforce training.
Rising input costs: The prices of raw materials, such as steel and aluminum, have been increasing globally, which has led to higher input costs for the automobile industry. This has put pressure on companies to increase prices or absorb the costs, which can impact their profitability.
Infrastructure challenges: The development of electric vehicle infrastructure, such as charging stations, is still in its early stages in India. This can be a challenge for companies that are looking to introduce electric vehicles to the market, as consumers may be hesitant to purchase these vehicles if charging infrastructure is not readily available.
Sustainability Targets Influence Policies: The automotive market stands at a critical juncture as sustainability targets are exerting a significant influence on regulatory policies, driving organizations towards greener initiatives.
Regulatory Changes: Governments worldwide are tightening emissions standards and introducing EV mandates, which may require significant operational adjustments.
Rising Costs of Materials: The prices of raw materials like lithium, cobalt, and steel have surged, increasing vehicle production costs.
Economic slowdown and market volatility : Fluctuating fuel prices, supply chain issues, inflation and geopolitical (like trade wars and currency fluctuations) pose ongoing risks.
Intense competition from counterparts may add further pressure on margin of manufacturers.
Currently, the energy crisis, gas shortages, rising inflation and Federal Reserve rates, labor shortages, high consumer demand, unpredictability in the supply chain and arising threat of cyber-attacks are some of the handicaps being faced by the automotive industry.
Exchange rates fluctuations coupled with movement in prices of Crude Oil and down-stream Petrochemicals, trade war, any government sanctions on supply chain etc. are all concern areas.
The overall trend is challenging, but remaining competitive in this changing scenario will be the toughest challenge. The combination of low manufacturing costs along with quality systems would give an edge to companies in terms of pricing and quality. Expansion and diversification will help break into new markets. It would be imperative for these companies, which are largely based on traditional management practices, to imbibe technology in a big way. The SMEs can exploit these opportunities through joint ventures, collaboration and technical tie-ups. Knowledge, specialization, innovation and networking will determine the success of the SMEs in this globally competitive environment.
Your company is power, manpower and capital intensive business. Power is obtained from Maruti from its co-shared power plant which runs on gas and DHBVN Ltd and DG Set. The increase in per unit cost of power supply will materially affect the cost of production. Company has installed 1350 K.W. Solar Power Plants at its Manesar Plant and Gurgaon plant which is likely to generate 15 lacs units in a year. This will help in power cost management. Your company has availed net metering facility from UHBVN/DHBVNL/HVPNL for both Gurugram & Manesar plant of the Company which in turn will save the energy bills.
Risk Management Report
Your Company believes that, periodic review of various risks which have a bearing on the business and operations is vital to proactively manage uncertainty and changes in the internal and external environment so that it can limit the negative impact and capitalize on opportunities.
Risk management framework enables a systematic approach to risk identification, leverage on any opportunities and provides strategies to manage, transfer, avoid or minimize the impact of the risks and helps to ensure sustainable business growth with stability of affairs and operations of the Company.
Keeping the above in view, your Companys risk management is embedded in the business processes. As a part of review of business and operations, your Board with the help of the management periodically reviews various risks associated with the business and products of the Company and considers appropriate risk mitigation processes. However, there are certain risks which cannot be avoided but the impact can only be minimized. The risks and concerns associated with each segment of your Companys business are discussed while reviewing segment-wise Management Discussion and Analysis Report. The other risks that the management review includes: a) Industry and services risk: This includes economic risks like demand and supply chain, profitability, gestation period etc.; services risks like infrastructural facilities; market risks like consumer preferences and distribution channel etc.; business dynamics like inflation/defiation etc.; competition risks like cost effectiveness. b) Management and operational risks: This includes risks to property; clear and well-defined work process; changes in technology/ upgradation; R&D risks; agency network risks; personnel and labour turnover risks; environmental and pollution control regulations; locational benefits like near metros.
c) Market risks: This includes raw material rates; quantities, quality, suppliers, lead time, interest rate and forex risk. d) Political risks: This includes elections; war risks; country/area risks; insurance risks like fire, strikes, riots and civil commotion, marine risks, cargo risks etc.; fiscal/monetary policy risks including taxation risk. e) Credit risks: This includes creditworthiness; risks in settlement of dues by clients and provisions for doubtful and bad debts. f) Liquidity risks: This includes risks like financial solvency and liquidity; borrowing limits, delays; cash/reserve management risks and tax risks. g) Disaster risks: This includes natural calamities like fires, _oods, earthquakes, etc.; man made risk factors arising under the Factories Act, Mines Act, etc.; risk of failure of effective disaster management plans formulated by the Company. h) System risks: This includes system capacities and system reliability risks; obsolescence risk; data integrity risk and coordination and interface risk. i) Legal risks: This includes contract risks; contractual liabilities; frauds; judicial risks and insurance risks. j) Government policies: This includes exemptions, import licenses, income tax and sales tax holidays, subsidies, tax benefits etc. k) Financial Risk: This includes risks associated with fluctuations in foreign currency rates, import duties and taxes, fluctuation in the price of various inputs including raw material supplies and underutilized capacity. Your Company reviews forward exchange contracts/ derivative contracts to analyze foreign exchange exposure. Both the operational and financial risks are constantly assessed, and adequate steps are taken from time to time to mitigate them successfully.
Financial Performance
Net turnover of your Company has increased by 15.10% from Rs. 33,773.92 lacs in 2023-24 to Rs.38,874.34 lacs in current year. Your Company has earned a pre-tax profit of Rs.1,146.16 lacs as compared to profit of Rs. 524.33 lacs in the last year. Company has earned cash profit of Rs.2,153.05 lacs as compared to Rs.1,943.92 lacs in 2023-24.
Ratios
The following are analytical ratios for the year ended March 31, 2025 and March 31, 2024
Particulars |
Numerator | Denominator | For the year ended March 31, 2025 | For the year ended March 31, 2024 | Variance |
Current Ratio | Current assets | Current liabilities | 0.79 | 0.84 | -6.00% |
Debt Equity Ratio | Total debt1 | Shareholders equity | 2.83 | 1.62 | 74.91% |
Debt Service Coverage Ratio6 |
Earnings available for debt service2 | Debt service3 | 1.346 | 1.348 | - 0.18% |
Return on Equity7 |
Net profit after taxes | Average shareholders equity | 14.50% | 7.00% | 107.07% |
Inventory Turnover Ratio |
Revenue | Average inventory | 9.35 | 11.94 | -21.71% |
Trade receivable Turnover Ratio |
Revenue | Average trade receivable | 6.31 | 6.95 | -9.19% |
Trade payable Turnover Ratio |
Purchases4 | Average trade payables | 5.85 | 6.82 | -14.19% |
Net Capital Turnover Ratio8 |
Revenue | Average working capital | -9.95 | -17.96 | -44.57% |
Net Profit Ratio9 | Net Profit | Revenue | 2.20% | 1.09% | 101.19% |
Return on Capital employed |
Earnings before interest and taxes | Capital employed5 | 9.28% | 8.21% | 13.12% |
Return on Investment10 |
Earnings before interest and taxes | Average total assets | 8.29% | 6.24% | 32.85% |
1. Long term borrowings + Short term borrowings
2. Net Profit after taxes + Non-cash operating expenses + Interest + other adjustments like loss or gain on sale of Fixed assets etc.
3. Interest + Lease payments for the current year + Repayments of long term borrowings
4. Purchase of raw material + stores and spares including repair & maintenance + packaging
5. Total equity + Lease liabilities + Total borrowings + Deferred tax liability Intangible assets Reasons for variations
6. Debt Service Coverage ratio has increased primarily due to increase in total debt.
7. Return on Equity ratio has increased primarily due to increase in turnover and higher profitability thereof.
8. Net Capital turnover ratio has decreased primarily due to an increase in current assets which led to decrease in working capital.
9. Net profit ratio has increased primarily due to increase in turnover and higher profitability thereof.
10. Return on Investment ratio primarily increased due to increase in turnover and higher profitability thereof.
Internal Financial Control System and their adequacy
The Companys internal audit system has been continuously monitored and updated to ensure that assets are safeguarded, established regulations are complied with and pending issues are addressed promptly Your company has adequate internal control systems commensurate with its size and operations, although not documented. The company regularly gets its accounts audited by the internal auditor.
Further internal audit has been out sourced to M/s Goel Garg & Co., Chartered Accountants. The Audit covers all the areas e.g. Finance, HR, Purchase, Statutory Compliance etc. and regular audits are conducted by Internal Auditors.
Further, the audit committee reviews reports presented by the internal auditors on a routine basis. The committee makes note of the audit observations and takes corrective actions wherever necessary. It maintains constant dialogue with statutory and internal auditors to ensure that internal control systems are operating effectively. Based on its evaluation (as provided under section 177 of the Companies Act, 2013 and Regulation 18 of SEBI Listing Regulations, the Audit Committee has concluded that as of 31st March, 2025, the Internal Financial Controls were adequate and operating effectively.
M/S. KMGS & Co. Chartered Accountants, the Statutory Auditors of the Company audited the financial statements included in this Annual Report and issued a report on the internal controls over financial reporting (as defined in Section 143 of the Companies Act, 2013).
Contingent liabilities and commitments (to the extent not provided for): (i) Contingent liabilities
NIL
(ii) Guarantees
In respect of outstanding bank guarantees: _ 747.77 lakh (Previous year _299.28 lakh)
(iii) Commitments
Estimated amount of contracts, remaining to be executed on land Nil (Previous year _2,080.81 lakh), on machinery / spare parts of machinery (net of advances) _1,306.69 lakh (Previous year _370.93 lakh approx).
Human Resources/Industrial Resources
The Company believes that the quality of employees is the key to its success. In view of this, it is committed to equip them with skills, enabling them to evolve with technological advancements.
During the year, various initiatives had been taken by the Company to improve the performance and productivity levels in various departments of the company. The company has its own in-house technical center in the plant to train the new recruits before their placement that helps in optimum utilization of resources as well as maintaining quality standards. It also indulges into and implements various HR initiatives and activities including employee welfare, special rewards, performance review system and various employee motivation activities.
Health, Safety and Environment remains our top priority. Periodic audits are carried out both internally as well as through external agencies to identify gaps and to define action items for continuous improvement, ensuring a safe workplace for employees.
The company has already undertaken KAIZEN with an aim to become a world-class company. Your company has already adopted the suggestions scheme in the company which is increasing the employees participation in managing the company.
Cautionary Statement
Management Discussion and Analysis Report may be forward looking statement. Actual result may differ materially from those expressed or implied depending upon global and Indian regulations, tax regimes, and economic developments within India and overseas.
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