Lumax Auto Technologies Ltd. printed decent set of numbers in Q3 FY23. Revenue de-grew 9% QoQ to Rs 4.45 billion led by weak original equipment manufactureres volume (especially for Bajaj Auto Ltd.). Ebitda de-grew 9% QoQ to Rs 473 million with flat QoQ margin at 10.6%, negative impact of adverse mix was partially offset by softening raw material expenses.
Management expects to outperform industry growth on back of increasing content per vehicle, new product additions, premiumisation, and strong joint ventures performance. Lumax Auto is witnessing strong growth in plastic integrated parts, aftermarket and gear shifter business.
Fueled by the improving product mix, new client acquisitions and new product additions and premiumisation. With a strong 12/14% revenue/Ebitda compound annual growth rate over FY23E‐25E, Lumax Auto is poised for re-rating, as reinvestment and rising capital efficiency to drive value.
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