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Yes Securities Report
Sona BLW Precision Forgings Ltd.'s Q4 FY23 results were better as revenue/Ebitda/adjusted profit after tax exceeded our/street estimates by 4.9%/8.6%/12.2% and 4%/7%/16.5% respectively. Ebitda margins came in better at 26.9% (estimate: 26%).
This was largely led by better revenue execution as well as cost control as anticipated decline in raw material doesn't materialise as gross margins contracted ~90 basis points QoQ at 54.2%.
On the positive side, the key highlight of the quarter was the new order win to supply, final drive differential assemblies, intermediate gears and input shafts for upcoming electric vehicle Class 4 truck from North American customer worth Rs 5 billion with an start of production expected in Q4 FY24.
It will be Sonal BLW's first EV commercial vehicle entry ever. However, new order addition at Rs 5 billion was lower than expected (versus Rs 42 billion/ Rs 4 billion/ Rs 28 billion orders added in previous three quarters).
Sona BLW's overall orderbook stands at Rs 215 billion as of FY23 (versus Rs 238 billion in December 2022 and Rs 186 billion as of March 2022).
Sona's EV revenue mix during FY23 increased to ~26% (versus ~23% in September 2022).
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