New Delhi, Nov 1 (PTI) Auto component maker Sona BLW Precision Forgings Ltd (Sona Comstar) expects its annual investments, currently at Rs 500-600 crore, to rise as it scales up operations, with a focus on R&D, capacity expansion and new capabilities, its Managing Director and Group CEO Vivek Vikram Singh said.
In an interview to PTI, Singh shared that the company will continue investing across all its three business lines, adding that it had introduced three new products during the September quarter.
"Annual investment is currently around Rs 500-600 crore. This should increase as we grow over the decade," he said.
Singh said investments would cover multiple areas, including R&D, capacity additions, capability additions and new processes, with the company focusing on developing entirely new products.
According to the company's Q2 results release, the three products commercialised during the quarter were a helical limited slip differential for EVs, air springs for railway coaches and rear radar sensors for two-wheelers.
Sona BLW Precision Forgings Ltd reported a 31 per cent rise in consolidated profit for the September quarter at Rs 223 crore, from Rs 170 crore a year ago.
Its revenue from operations grew to Rs 1,535.84 crore, from Rs 1,138.29 crore, during the July-September period of the last fiscal year.
On the company's geographical growth outlook, he said India contributes around 50 per cent of its business and the share is expected to remain in the 50-55 per cent range as it expands in other markets.
"Orders already won will begin to convert, and North America should see good growth next year, with India keeping pace. India's contribution should remain in the 50-55 per cent range," Singh said.
The company secured new orders worth Rs 3,600 crore during the quarter, marking its third-best quarter in terms of order bookings.
Singh said these orders would translate into revenue over different timelines, depending on the stage of vehicle development and model cycles.
On opportunities arising from global companies diversifying supply chains away from China, Singh said India could gain significantly, provided domestic suppliers develop the necessary design and manufacturing capabilities.
"India could gain significantly, as companies are looking to diversify supply chains away from China. However, Indian suppliers must be capable of taking on that business. The ecosystem needs to demonstrate design capability and manufacturing quality," he said.
Singh added that a wider improvement in manufacturing standards across the domestic supplier ecosystem could help attract more business and volumes to India. On acquisitions, Singh said the company was evaluating opportunities to strengthen its capabilities, including in technology-related areas.
"We are evaluating many opportunities, but there is nothing reportable that I can comment on at present. There are abundant opportunities, and it is important to be clear not only about what to pursue but also what not to pursue. M&A is something we are considering very seriously," Singh said.
The company's battery-electric vehicle (BEV) revenue, excluding hybrids, grew 129 per cent year-on-year in the second quarter and accounted for 51 per cent of its automotive revenue.
The pace of electric vehicle adoption in India had been faster than the company's expectations, Singh added.
