Management indicated a healthy revival in electrification is driving demand across India, EU and NA. Strong growth during Q2 was led by a recovery in EV differential assembly volumes and ramp-up of orders for traction and suspension motors. Growth momentum for both, traction and suspension motor businesses, is expected to remain robust, backed by order wins (gaining market share) and underlying market growth.
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ICICI Securities Report
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Sona BLW Precision Forgings Ltd.'s Q2 FY27 Ebitda print was well ahead of ICICI Securities' estimates. This was supported by a strong ramp-up in traction and suspension motor businesses and a recovery in EV-differential assembly volumes, even as an adverse mix impacted its profitability.
Its EV business (48% of automotive revenue in H1) is also well positioned amid a strong revival in the electrification trend supported by a strong order book (~Rs 25,100 crore; ~60% from EVs).
Consistent expansion in its product portfolio, gradual diversification of the customer/geographic mix, and a rising market share in both driveline and the traction motor segment could further support growth.
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We build in 26%/28% revenue/EPS CAGR over FY26–29E. Retain ADD with a DCF-based revised TP of INR 900 (vs. INR 885).
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