Any current/future new fundraising through debt or equity?

The company currently has no plans for new fundraising through debt or equity. They have sufficient cash on hand (~₹142 crores as of latest quarter) to meet upcoming CAPEX and working capital requirements. For FY21-22, the focus is on deploying cash for growth opportunities and CAPEX of about ₹80-90 crores. Dividend payments are under review and likely deferred due to growth investments and COVID-related uncertainties. The company aims to maintain cautious cash reserves considering COVID risks and global uncertainties. They are prioritizing working capital reduction and fixed cost reduction to

Any current/future capex/capital investment/strategic investment?

The company has a CAPEX plan of about Rs. 70-90 crore for the current year. CAPEX is mainly focused on increasing capacity in Patiala and Bangalore facilities for Pistons and Piston Rings. The investment supports growth opportunities of 15% to 20% top-line increase expected for the year. CAPEX also aims at accommodating increased export business and qualifying for global OEM supply. The company is adding operational productivity and rearranging global footprint, particularly with Euro-VI norms and moving some global production to India. No plans to diversify product portfolio beyond Pistons, P

Future growth expectations in sales/revenue/volumes?

The company expects top-line (revenue) growth of 15% to 20% for the current financial year, contingent on COVID-19 conditions and market stability. Volume growth is targeted at 15% to 20%, aligned with market expansion and capacity enhancements. Capacity expansion of around 8% to 9% is underway, including significant CAPEX of approximately Rs. 80-90 crore focused on Patiala and Bangalore facilities for Pistons and Piston Rings. Export business is being expanded with capacity added to cater to OEMs supplying export markets. The two-wheeler segment order book is stable for the next 3-4 y

Future growth expectations in earnings/operating earnings/profits/EPS?

Company targets 15%-20% top-line growth in FY21-22, contingent on COVID situation and market stability. EBITDA margin aimed at 15%-16%, similar to FY18-19 levels, though challenged by rising material costs with recovery expected next year. Material cost increase of 30%-35% expected to be 80%-90% recoverable over a year, not fully in the current year. Q1 FY22 showed operational EBITDA of 11%, down from 16% in previous quarter due to COVID-induced shutdowns and material cost lag. Earnings per share (EPS) improving with volume growth and operational profitability, with positive profit bef

Current/ Expected Orderbook/ Pending Orders?

The order book for two-wheelers is expected to remain flat or slightly decline by 2-3% over the next 3-4 years due to market trends shifting towards electric vehicles. The company has added two new customers in the two-wheeler export segment recently. The export order book includes 2.5 to 3 liter pickup trucks and other vehicle categories. Supplies are made both directly to OEM export customers and through intercompany shipments (e.g., units in Thailand). Capacity expansion is planned to cater for export growth. The management expects stable demand for two-wheelers for at least the next three

Federal-Mogul Goetze (India) LtdQ1 FY22

Federal-Mogul Goetze (India) Ltd Q1 FY22 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹441P/E: 13.6Market Cap: ₹2.5K Cr

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

N/A

Order

Yes

Capex

Yes

2 of 4 growth signals are positive.

Full analysis

Revenue guidance

Category 3

The company expects top-line (revenue) growth of 15% to 20% for the current financial year, contingent on COVID-19 conditions and market stability.
Volume growth is targeted at 15% to 20%, aligned with market expansion and capacity enhancements.
Capacity expansion of around 8% to 9% is underway, including significant CAPEX of approximately Rs. 80-90 crore focused on Patiala and Bangalore facilities for Pistons and Piston Rings.
Export business is being expanded with capacity added to cater to OEMs supplying export markets.
The two-wheeler segment order book is stable for the next 3-4 years, with some new customers added recently in exports.
Electrification is seen as a long-term transition; however, the company expects continued participation in hybrid and mild hybrid vehicles, supporting future growth.
Working capital reduction and operational productivity improvements are expected to support volume and margin growth.

Margin guidance

Category 3

Company targets 15%-20% top-line growth in FY21-22, contingent on COVID situation and market stability.
EBITDA margin aimed at 15%-16%, similar to FY18-19 levels, though challenged by rising material costs with recovery expected next year.
Material cost increase of 30%-35% expected to be 80%-90% recoverable over a year, not fully in the current year.
Q1 FY22 showed operational EBITDA of 11%, down from 16% in previous quarter due to COVID-induced shutdowns and material cost lag.
Earnings per share (EPS) improving with volume growth and operational profitability, with positive profit before tax and net profit (PAT).
Cash flow generation strong, though CAPEX of Rs. 70-80 crore planned for capacity expansion and export growth, affecting net cash flow temporarily.
Dividend payments deferred in short term due to CAPEX and working capital needs; policy under review for longer term.
Expansion in capacity, especially for exports and OEMs, expected to contribute to future growth.

See what Federal-Mogul Goetze (India) Ltd management said on margin guidance — free account, 30 seconds.

Fundraise plans

The company currently has no plans for new fundraising through debt or equity.
They have sufficient cash on hand (~₹142 crores as of latest quarter) to meet upcoming CAPEX and working capital requirements.
For FY21-22, the focus is on deploying cash for growth opportunities and CAPEX of about ₹80-90 crores.
Dividend payments are under review and likely deferred due to growth investments and COVID-related uncertainties.
The company aims to maintain cautious cash reserves considering COVID risks and global uncertainties.
They are prioritizing working capital reduction and fixed cost reduction to sustain operations without needing fresh capital.
Longer-term dividend strategies will be reconsidered once cash requirements stabilize.

Order book

Yes

The order book for two-wheelers is expected to remain flat or slightly decline by 2-3% over the next 3-4 years due to market trends shifting towards electric vehicles.
The company has added two new customers in the two-wheeler export segment recently.
The export order book includes 2.5 to 3 liter pickup trucks and other vehicle categories.
Supplies are made both directly to OEM export customers and through intercompany shipments (e.g., units in Thailand).
Capacity expansion is planned to cater for export growth.
The management expects stable demand for two-wheelers for at least the next three years with no anticipated volume drops.
Overall capacity is fungible across various product categories (two-wheelers, three-wheelers, passenger cars, commercial vehicles, tractors) to adjust to market demand and regulatory changes.

See what Federal-Mogul Goetze (India) Ltd management said on order book — free account, 30 seconds.

Capex plans

Yes

The company has a CAPEX plan of about Rs. 70-90 crore for the current year.
CAPEX is mainly focused on increasing capacity in Patiala and Bangalore facilities for Pistons and Piston Rings.
The investment supports growth opportunities of 15% to 20% top-line increase expected for the year.
CAPEX also aims at accommodating increased export business and qualifying for global OEM supply.
The company is adding operational productivity and rearranging global footprint, particularly with Euro-VI norms and moving some global production to India.
No plans to diversify product portfolio beyond Pistons, Piston Rings, Valve Seats, and Guides.
The company is reviewing dividend policy but prioritizes cash preservation for CAPEX and market uncertainties, especially due to COVID risks.
The CAPEX will be spent largely in LV (light vehicles) and commercial vehicle segments, including customers like Ford Puma.

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Federal-Mogul Goetze (India) Ltd Q1 FY22 Earnings Call Analysis

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What Federal-Mogul Goetze (India) Ltd's management said in earlier quarters