Uniparts India Ltd. expects a return to a 20% Ebitda margin over the next three years, likely by FY28, Group Chief Operating Officer Tanushree Bagrodia said on Thursday.
Speaking to NDTV Profit on Thursday, Bagordia said that the components manufacturer is maintaining its mid-teens revenue growth guidance for FY26.
"Our gross margins have remained stable year-on-year. We've controlled our costs, especially fixed costs, and as the top line grows, it's all going to be margin-accretive," she said.
"I think it’s safe to say that in the mid-term, we will return to 20% margins, and as we get there, ROEs will move closer to 30%. I'd say it's a two-to-three-year game," the COO said.
Bagrodia's projections of a strong outlook were backed by strong order books and new business wins. She highlighted that the industry as a whole is undergoing a major transformation.
"Going forward, we see the large ag segment in North America remaining under pressure due to volatile commodity prices, higher interest rates and elevated input costs. However, the European large ag market is looking much better.
"Large ag doesn't exist in Asia Pacific. We've worked hard to deepen our customer relationships and have secured strong new business in Europe and the US, positioning us to outperform globally," she noted.
On capacity utilisation and expected business, she explained that Uniparts follows a "best cost supplier" strategy.
"We acquired a manufacturing facility in the US to enable dual-shoring for our customers. At the same time, we started warehousing solutions to support near-shoring, and we are now expanding that by setting up a new warehouse in Mexico to serve our customers. I believe we have adequate capacity to grow," the COO outlined.
In India, the company has six manufacturing locations and recently added a new facility in Ludhiana for small and medium fabrication.
According to Bagrodia, Uniparts manufacturing model allows for flexible scaling. "As long as we keep balancing capex and keep building on our capabilities, that is never a roadblock for us to service our customers."
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