Precision CamshfQ2 FY24

Precision Camshf Q2 FY24 Earnings Call Analysis

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

Price: ₹117P/E: 36.4Market Cap: ₹1.1K CrSector: Auto Components

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

N/A

Order

N/A

Capex

Yes

1 of 3 growth signals are positive — mixed outlook.

Full analysis

Revenue guidance

Category 3
  • Precision Camshafts sees very good visibility for camshaft business growth with long-term contracts from domestic and international customers.
  • The company has grown its camshaft business over the past two years in both casting and machined camshafts and expects this trajectory to continue.
  • New machining plants are being set up, and assembly camshaft business from OEM customers is increasing.
  • For the electric mobility subsidiary EMOSS, growth is expected but affected by general European market slowdown and uncertainties; demand is anticipated to pick up once market conditions improve.
  • In India, Precision has started deliveries of electric sub-4-ton LCVs for testing, targeting retrofit of existing fleets, with potential large addressable market due to over 2 million vehicles.
  • The new Solapur facility will enhance capacity and support growth in niche and intricate products and expanded electric mobility footprint.
  • Overall, the company remains optimistic but cautious due to current global and regional uncertainties.

See what Precision Camshf management said on margin guidance — free account, 30 seconds.

Fundraise plans

  • As of the latest earnings call, there are no current plans to raise capital either through debt or equity.
  • Karan Shah explicitly mentioned, "Not that I can comment on as of today," when asked about any capital raising.
  • The company is still evaluating the capital intensity of the EMOSS business and the overall need for raising funds.
  • They are cautious about capital raising and have not announced any firm timelines or plans related to fundraising for EV expansion or other business areas.

See what Precision Camshf management said on order book — free account, 30 seconds.

Capex plans

Yes
  • Precision Camshafts is setting up new machining plants to support growth in the camshaft business.
  • A large solar power plant (15 MW) has been established to reduce energy costs, saving approximately INR 1 crore per month since July.
  • The company has started work on developing a new 25-acre campus in Solapur, which will house a state-of-the-art machine shop for assembled camshafts and other niche products, and expand their electric mobility footprint.
  • MFT in Germany plans to build production of new non-engine components in H1 of 2024.
  • No specific capital raising plans disclosed yet for Indian EV expansion or EMOSS business; the company is still in early stages for OEM vehicle development and related capital intensity is not fully articulated.

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How does Precision Camshf rank vs peers in Auto Components?

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